We will need double the number of passenger and freight aircraft by 2041: Airbus


Jhe world will need to more than double the number of passenger and cargo planes by 2041 to meet demand, according to the latest Airbus outlook. The European aerospace giant says nearly 47,000 planes will be in service by 2041, up about 105% from the 22,880 planes that were in service at the start of 2020.

According to Airbus, only a small percentage of these old jets and planes will remain in the air in 20 years, which means that a large majority of them will have to be replaced to meet stricter emissions standards. Today, only around 20% of the total global fleet is represented by fuel-efficient next-generation aircraft; by 2041, this figure will be over 95%, according to Airbus.

The lion’s share of growth is expected to occur in the fast-growing Asia-Pacific region, followed by North America, Europe and the Commonwealth of Independent States (CIS), which includes former Soviet states.

World trade hits a new high

Compared to passenger aircraft, freighters represent a relatively small percentage of the global fleet. However, as international trade is expected to double over the next 20 years, the number of cargo planes capable of carrying more than 10 tonnes will need to increase to over 3,000 by 2041, from just over 2,000 today.

With soaring inflation right now and a looming recession, it may seem doubtful to some that trade can double in 20 years. Nevertheless, we are already seeing the value of internationally traded goods and services reach new heights. In the first quarter of 2022, world trade hit a new record high of $7.7 trillion, according to data just released by the United Nations Conference on Trade and Development (UNCTD).

Granted, much of this increase in value is due to high prices, but I expect to see new quarterly highs over time as the size of the global middle class continues to grow.

World trade hit a record $7.7 trillion in the first quarter of 2022

I travel the world and the seven seas…

Passenger traffic is also expected to more than double over the next 20 years, according to Airbus, which will require thousands of new and improved planes. Between 2019 and 2041, global traffic is expected to grow at a compound annual growth rate (CAGR) of 3.6% and could eventually exceed 20 trillion revenue passenger kilometers (RPK).

Passenger traffic is expected to grow at a CAGR of 3.6% from 2019 to 2041

You only thought the airports were crowded now.

It is for this reason that the Travel Centers will need to be expanded and updated.

Just last week, the US Department of Transportation awarded nearly $1 billion to 85 airport projects under the government’s $1.2 trillion infrastructure program approved by Congress. Last year. This first billion dollars will fund new terminals, increase gate capacity and add new air traffic control towers, restrooms, baggage claim areas and more.

Boeing delivers the most planes since 2019

Airbus is expected to release its first-half results later this month, but for now the focus is on US rival Boeing.

The company, which is moving its headquarters from Chicago to Arlington, Va., due to the city’s proximity to Washington, DC, reported strong second-quarter delivery results this week. One hundred and twenty-one aircraft were delivered in the three months ended June 30, bringing the year-to-date figure to 216 aircraft. Boeing delivered 51 planes in June alone, making it the company’s best month since March 2019.

We like Airbus and Boeing as both companies drive innovation to gain additional global market share. And if Airbus’ projections are correct, there should be plenty of business to be had.

Watch our video, “Can Airlines Continue to Thrive Through 2022?” by by clicking here!

Originally published by US Global Investors on July 13, 2022.

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Holdings may change daily. Holdings are reported at the end of the most recent quarter. The following securities mentioned in the article were held by one or more accounts managed by US Global Investors as of (06/30/2022): Airbus SE, The Boeing Co.

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