AIN Blog: Market Forecasts: Junk Science or Just Junk?

 - September 14, 2012, 2:20 PM
Airbus COO for customers John Leahy delivered his company’s global market forecast this month in London. Airbus projects a 20-year demand for more than double the number of aircraft in the category of the A380 than Boeing predicts. (Photo: Airbus)

While any direct comparison of the fundamentally incongruent market forecasts published by the Western world’s four civil airframe manufacturers might seem like an exercise in futility, a little extrapolation can reveal some basic differences in opinion, methodology and, maybe most significantly, equipment offerings. Long a believer in the benefits of hub-bypass strategies, Boeing, for example, sees far less demand for equipment in the size category occupied by the A380 superjumbo than does Airbus, while Airbus predicts nearly a reciprocal difference in requirement for large twin-aisle types. However, the biggest variation lies with the two companies’ single-aisle projections, which, apart from the fact that Boeing includes regional jets in its report, essentially accounts for the entire difference in forecast totals.

Discounting the 2,020 regional jets in its forecast, Boeing predicts a total unit demand for nearly 32,000 airplanes over the next 20 years, while Airbus projects a need for 28,200. In the single-aisle category, Boeing sees deliveries totaling 23,240, compared with Airbus’s projection of just 19,520.   

In the realm of regional jets and small single-aisle “mainline” types, an even more striking disparity emerges between Bombardier and Embraer. Bombardier’s projection for the total market ranging from 20 to 149 seats stands at 12,800, while Embraer’s somewhat narrower forecast—covering a capacity range from 30 to 120 seats—shows a total 20-year demand for only 6,795 airplanes. While the Bombardier forecast seems to reflect an optimistic outlook for the segment occupied by the CSeries, the upper end of the 120- to 149-seat range could include Boeing and Airbus products as well, perhaps lending it more plausibility. But perhaps more inexplicably, Bombardier’s outlook reflects a demand for more than double the units in the 60- to 99-seat segment than Embraer projects for the 60- to 90-seat category. Such a disparity could suggest a huge difference in opinion over the future of 70-, 76- and 90-seat jets or a remarkably bullish outlook by Bombardier for airplanes seating between 90 and 100 seats.

So to what might we attribute such wildly different outlooks? Wishful thinking? Unsound methodology? Maybe a desire to justify investments in future products to differing degrees.

Whatever the reason, none of them can predict wars, natural disasters, pandemics, or any other calamitous event one might care to contemplate. So take them with the proverbial grain of salt…and consider their source.