The 2020 BMO projects hardships related to the COVID-19 pandemic to continue in the commercial sector with its defense market remaining stable. (Boeing)
The 2020 Boeing Market Outlook (BMO) and 2020 Commercial Market Outlook (CMO) was released projecting continued challenges for the commercial aviation and service markets and stability for the global defense and government service markets, according to an Oct. 6 press release.
The COVID-19 pandemic has caused significant hardship for airlines, who have seen a 90 percent decline in passenger traffic in 2020. The new BMO projects a $2 billion decline from last year’s projection with a total market value of $8.5 trillion over the next decade. Last year the total market value was $8.7 trillion.
The commercial aviation sectors were hit hardest with projected demand for commercial airplanes down 11 percent from last year. However, the forecast for commercial and government services through 2029 offers a $3 trillion market opportunity, according to the BMO. This opportunity focuses on digital solutions to adjust to market demand.
“Commercial aviation is facing historic challenges this year, significantly affecting near- and medium-term demand for airplanes and services,” said Darren Hulst, vice president of Commercial Marketing at Boeing. “Yet history has also proven air travel to be resilient time and again. The current disruption will inform airline fleet strategies long into the future, as airlines focus on building versatile fleets, networks and business model innovations that deliver the most capability and greatest efficiency at the lowest risk for sustainable growth.”
The CMO predicts that the widebody airplane market will suffer long-term effects from the pandemic while the single-aisle airplanes, like the 737 MAX, will recover quicker. Operators are expected to need 32,270 new single-aisle airplanes in the next 20 years. The widebody demand sits at 7,480 new passenger planes by 2039.
The CMO projects growth in passenger traffic and air cargo demand, each increasing 4 percent annually.
The defense and military sectors could provide Boeing with a $2.6 trillion market opportunity, according to the BMO.
“While this year has been unprecedented in terms of its disruption to our industry, we believe that aerospace and defense will overcome these near-term challenges, return to stability and emerge with strength,” Boeing Chief Strategy Officer, Marc Allen, said.
Boeing’s defense and space market is boosted by the national and international demand for military aircraft, autonomous systems, satellites, and spacecraft, 40 percent of which are expected to be sold outside the U.S.
Aviation services are still expected to be in demand with the served market for commercial services valued at $1.6 trillion and government services valued at $1.4 trillion.