NEW DELHI – Boeing Co. said on Monday it expects Indian airlines to order up to 2,100 new aircraft worth $290 billion over the next 20 years, calling it the highest-ever forecast for Asia’s third-largest economy.
The planemaker said it expected single-aisle planes, such as the next generation 737 and 737 Max, to account for the bulk of the new deliveries, with India likely to take 1,780 such planes.
India is one of the world’s fastest-growing aviation markets, with domestic passenger traffic growing at around 20 percent in the past few years.
“The increasing number of passengers, combined with a strong exchange rate, low fuel prices and high load factor bodes well for India’s aviation market, especially for the low-cost carriers,” said Dinesh Keskar, senior vice president, Asia Pacific and India sales at Boeing Commercial Airplanes.
The world’s biggest maker of jetliners said it expected passenger growth of about 8 percent in South Asia, dominated by India, over the next 20 years, compared with the world average of about 4.7 percent.
Last year, India overhauled rules governing its aviation industry, liberalising norms for domestic carriers to fly overseas and incentivising air travel to smaller cities by capping air fares and opening airports.
Boeing could increase its demand forecast next year depending on how quickly India’s plan for regional connectivity takes off, Keskar added.
The U.S. planemaker dominates the wide-body aeroplane market in India, with Jet Airways and state-owned carrier Air India among its biggest customers, while competitor Airbus sells the bulk of small planes preferred by low-cost carriers such as InterGlobe Aviation’s IndiGo.
Low-cost carriers dominate Indian skies, accounting for more than 60 percent of flights in the country.
To plug this gap in its portfolio, and following runaway sales of Airbus’ A321neo, Boeing launched the 737 MAX 10 single-aisle jet at an air show in Paris in June. India’s SpiceJet airline has already placed a provisional order for 40 737 MAX 10 aircraft.
Boeing also expects Indian carriers to order its new 777X family, comprising the 350-375 seat 777-8 and the 400-425 seat 777-9, due to enter service in 2020, but said it would take several years for this to happen.
Air India still has to take deliveries of three of its 777-300ER and Jet Airways is on the 787-9, Keskar said, adding that when these planes need to be replaced after a few years the airlines could look at the 777X family.
Boeing has won 326 orders for the latest version of its 777 but apart from an order from Singapore Airlines earlier this year, demand for the world’s largest twin-engined airplane has been relatively slow since it was launched with a barrage of orders mainly from Gulf carriers in 2013.
The plane maker expects worldwide demand for 41,030 aircraft over the next 20 years, putting India’s share of the total at about 5 percent.