$4 trillion in new aircraft needed

Boeing upped its forecast on Thursday for aircraft demand over the next 20 years, saying airlines will need $4 trillion worth of new planes to meet a pickup in passenger numbers, particularly in the Asia-Pacific region.

Airlines will need 33,500 new jets from now through 2030, Boeing said in a statement.

Boeing executives released the new forecast ahead of next week's Paris Air Show, which highlights the planemaker's industry-dominating rivalry with Europe's Airbus.

Randy Tinseth, vice president of marketing for Boeing Commercial Airplanes, told reporters in Paris, that the company expects market demand to be "resilient" in the coming years, with 5 percent average annual passenger traffic growth.

He said the largest market will be for single-aisle jets seating between 90 and 240 passengers, with most the growth in the booming Asia Pacific region.

Boeing also noted that "volatile fuel costs, political upheaval in the Middle East and North Africa, and unresolved government debt in many industrialized economies create risk of a renewed downturn." But it said this should not hurt the industry long term.

The planemaker says it raised its forecast after passenger air traffic rose 8 percent in 2010, after declining about 2 percent in 2009 when much of the world was experiencing a deep recession.

Boeing announced Wednesday that it will ramp up production of the next-generation 737, its most popular jet.

Boeing is the biggest maker of commercial planes after Airbus, based on 2010 deliveries. Airbus delivered 510 commercial planes last year, compared with 462 for Boeing.

GoAir orders 72 new Airbus planes

Indian budget airline GoAir said Thursday it had placed a ê7.2-billion order for 72 new Airbus aircraft as local carriers continue an aircraft shopping spree to meet booming demand on the subcontinent.

The order comes on top of a previous ê2.4-billion deal made early last year with the European aircraft manufacturer to supply another 20 jets for use on short-haul domestic routes.

GoAir, which owns just 10 planes currently, said the order for 72 short-haul A320 planes was a "game-changer" and would help to improve access to air travel for more Indians.

"In terms of aircraft, we see tremendous potential in India, which has barely six airlines with 350 aircraft catering to a billion people, compared to China's present 1,100 aircraft," managing director Jeh Wadia said in a statement.

"With India's GDP growing at a brisk 8-9 percent per annum, we see a great future ahead for the aviation sector, including GoAir. Our strategy is to fly those who currently don't fly," he added.

GoAir, part of the Wadia Group conglomerate, was launched in November 2005 and currently flies to 18 destinations within India. It operates 931 flights a week with its small fleet and other leased planes.

The first batch of 20 A320s -- all of them NEO (new engine option) models, which Airbus says can cut fuel consumption by 15 percent -- will be delivered by 2012.

About 15 aircraft a year will be delivered every year from 2015, a company spokesman told AFP.
The low-cost airline also announced the appointment of a new chief executive, Giorgio De Roni, the former chief revenue officer at Italian airline Air One.

Aviation analysts said the orders reflect the expansion of the Indian airline sector, which has emerged strongly from the global financial crisis which crimped growth.

In January, GoAir's rival Indigo ordered 180 A320s worth ê15.6 billion at list prices, the largest ever deal with Toulouse, France-based Airbus.

India's largest private airline, Jet Airways, is also set to place a ê2.5 billion order for 10 A330 aircraft to expand its international routes, while Air India, the state-run national carrier, is looking at new lease deals, The Economic Times newspaper said last week.

"The essential point here is that all the private airlines are growing in terms of their fleets," said Mahantesh Sabarad, a senior analyst at Fortune Equity Brokers in Mumbai.

"It's natural that because they're growing and increasing their market share that they need more and more aircraft. At the same time, many of these players have fleets which need to be replaced," he told AFP.

Passenger traffic within India grew by nearly 18 percent in the last financial year to the end of March while international traffic also expanded, Sabarad said.

"A large growth in passenger traffic can surely be absorbed with these additional aircraft," he added.

Amber Dubey, from global consultants KPMG, said GoAir's order was "conservative" and a sign that Indian airlines were not trying to overstretch themselves as they did in the mid-2000s.

"They have learnt their lesson from about four or five years back and are not going for blockbuster deals," he said.

"The immediate need for airlines is to augment their fleets... They don't want to get to 2015 and find that it'll take two to three years to get new planes."

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