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Boeing Releases Indian Aviation Market Predictions

by Mike Godfrey, Tax-News.com, Washington

27 August 2015


India will require 1,740 new airplanes, valued at USD240bn, over the next 20 years, according to the latest forecasts from Boeing.

The company released its annual India Current Market Outlook (CMO) on August 13 in Mumbai, forecasting the South Asia region will have among the highest traffic growth around the world at 8.6 percent.

Dinesh Keskar, Senior Vice President of Asia Pacific and India Sales, Boeing Commercial Airplanes, said: "India's economy and the country's potential for air travel growth – both for leisure and business – continues to be strong and we remain confident in the Indian commercial aerospace market."

The largest demand from airlines in India will be for single-aisle airplanes, Boeing predicts. Meanwhile, low-cost carriers are expected to increase their market share to 30 percent.

"The Indian market is highly competitive and airlines are adapting with added capacity, moderate pricing discipline, and new business models, such as the growing number of low cost carriers," said Keskar.

Boeing believes that its Next-Generation 737 is well placed to capitalize on the market growth and demand for single-aisle aircraft.

Worldwide, Boeing projects demand for 38,050 new airplanes over the next 20 years, with India carriers needing more than 4.5 percent of the global total during the forecast period.

Meanwhile, IATA has said India will be home to almost 280 million travelers annually in 2029. In a keynote address at the Aviation Day India in July, Tony Tyler, IATA's Director General and CEO, said: "Already aviation and aviation-related tourism support seven million Indian jobs and USD23bn of India's GDP. The healthy growth of the sector has the potential to expand these benefits tremendously. But there are immense challenges which must be overcome–as seen in the sector's financial performance. While demand growth is robust and some airlines are generating profit, sector-wide losses for India are still expected to exceed USD1bn this year. Onerous regulation and processes, debilitating taxes and expensive infrastructure are holding back the industry's ability to deliver greater economic benefits to India."

TAGS: Asia Pacific | business | India | aviation

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