Demand for new aircraft in the Middle East is set to grow by 4.3 per cent annually, outstripping global demand of 3.2 per cent as passenger traffic numbers improve.
Passenger traffic in the region is forecast to grow at 4.3 per cent over the next 20 years, ahead of the global average of 4 per cent, according to plane maker Boeing.
The region will have a 13 per cent share of global air passenger traffic by 2039, a marginal increase from the 12 per cent share last year, according to Boeing's Middle East Commercial Market Outlook. Routes between Europe and the Middle East will continue to account for the biggest portion of traffic (25 per cent), followed by South Asia (18 per cent) South East Asia (12 per cent) and inter-regional traffic (12 per cent). China, Africa and North America will each make up 9 per cent of the total, with the remainder split between Russia/Central Asia and Oceania.
“In recent decades, several airlines in the Middle East have leveraged their geographical position to connect rapidly growing Asian economies and the more mature markets in Europe,” Darren Hulst, Boeing's vice president of commercial marketing, said. “At the historical crossroads connecting Europe, Africa and Asia, the Middle East and its airlines will remain a critical hub of sixth-freedom passenger flows and cargo throughout the 20-year outlook.”
Sixth freedom refers to the right of a country to transport passengers between two states through their home state.
Last month, Boeing revealed in its Global Commercial Market Outlook that the Middle East will need 2,945 new planes at a value of $685 billion over the next two decades.
The size of the region's commercial fleet is set to more than double to 3,500 by 2039, from 1,510 currently, both to meet new demand and replace older aircraft. The region's fleet will grow by 4.3 per cent per year, which is 35 per cent higher than the global growth forecast of 3.2 per cent per year. Demand for narrow-bodied jets will outstrip that for wide-bodies, growing to 49 per cent of the total, from 44 per cent last year.
In percentage terms, demand for freight planes will fall slightly to 4 per cent, but the number of freighters will grow to 150, up from 80 currently. The Middle East had a 13 per cent share of the global air cargo market last year, up from just 4 per cent in 1999.
The number of skilled aircraft personnel is also set to grow, with the region needing about 58,000 pilots, 59,000 technicians and 106,000 crew members by 2039.
Boeing and its main rival Airbus have struggled during the pandemic as customers have cancelled or postponed deliveries, with the aviation industry one of the hardest hit by the virus. Despite furloughing or laying off thousands of staff, global airlines are expected to burn through $77bn of cash in the second half of 2020 as declines in revenue continue to outpace cost savings, according to the International Air Transport Association.
Boeing, whose popular 737 Max were grounded since March last year after two fatal crashes, recorded a net loss of $3.5bn for the first nine months of the year, as revenue dropped by 27 per cent. On Wednesday, the Federal Aviation Authority gave clearance for the Max to return to the skies in the US.
Over a 20-year period, Boeing expects global demand for commercial aircraft to reach more than 43,000 new planes.
“While aviation has seen periodic demand shocks since the beginning of the jet age, the industry has recovered from these downturns every time as aviation plays an integral role in the global economy,” Mr Hulst said.
“The current market disruption will shape airline fleet strategies long into the future as airlines focus on building versatile fleets that provide future network flexibility, maximising capability while minimising risk and improving efficiency and sustainability."