-T / T / +T | Comment(s)

Friday, August 24, 2007

Russia, CIS Require Over 1,000 Aircraft

Over the next 20 years, Russia and the Commonwealth of Independent States (CIS) will require 1,060 aircraft worth $70 billion, according to Boeing (BA) in its updated annual forecast of the commercial aircraft market which, for the first time, includes the region. Now that China has been foreclosed to new airlines, U.S. regionals, many of which are exploring overseas ventures, may turn their sights toward Russia and CIS. Air traffic within Russia and the CIS is expected to grow six percent per year over the next 20 years.
Indeed, forty-three percent of the aircraft will be smaller regional jets while airplanes of the Boeing 747 size or larger will comprise two percent of the market. It’s good news for Sukhoi which is developing a competing regional jet between 70 and 130 seats, similar to the yet-to-be-launched Bombardier C-Series. Meanwhile, Embraer (ERJ) already has an aircraft for the up-to-120-seat market. The Sukhoi, however, is set to fly next month. Airplanes in the Boeing 737 size range will account for 44 percent of all commercial jetliners delivered to Russian and CIS airlines during the next 20 years, amounting to 470 units valued at $30 billion. Eleven percent – or 110 units at a value of $20 billion – will be twin-aisle airplanes like the Boeing 777 and 787.
The company said that public demand for more point-to-point travel options will also stimulate demand for smaller airplanes, said the manufacturer, which added airlines used large aircraft to connect passengers through hubs. Smaller planes will be able to offer new routes. However, Boeing’s definition of smaller planes is the 737. It noted that the number of nonstop flights has grown at an average rate of about five percent in Europe while the average airplane size has fallen.
"We will witness significant growth in the demand for air travel as the economies of Russia and the CIS continue to expand," said Craig Jones, vice president of Sales for Russia/CIS, Boeing Commercial Airplanes. "Both domestic and international air traffic has increased in Russia and the CIS by 36 percent over the last 10 years. Most indicators point toward continued economic growth for the region."
"We've already seen airlines like Aeroflot and S7 Airlines in Russia, AeroSvit in the Ukraine, Azerbaijan Airlines and Uzbekistan Airways order new single-aisle and twin-aisle airplanes this year. We can expect continued steady demand for new airplanes as airlines look to modernize and grow their fleets," Jones said.
"Liberalization of air traffic regulations, airline consolidation and the reduction or elimination of high tariffs on new airplanes could generate additional demand for new airplanes."
Live chat by BoldChat