Boeing Reduces Forecast for Jet Deliveries : Aerospace: Through 2010, company foresees worldwide deliveries of aircraft totaling $815 billion, down from the $857 billion it predicted last year.


In yet another indication of declining worldwide demand for commercial jetliners, Boeing Co. on Thursday said it cut its estimate of world aircraft deliveries through 2010 by 5% and indicated that its historical share of the world market has declined by one percentage point to 57%.

In its annual marketing forecast for world aircraft demand, Boeing forecast that worldwide deliveries of aircraft would total $815 billion, down from the $857 billion it forecast last year.

The reduction, however, is tempered by a projection that Boeing, McDonnell Douglas and Airbus Industrie, the world’s three major aircraft producers, will deliver more planes, though they will be smaller on average than in the past.

The Boeing report did not elaborate on the causes of the projected 5% decline in aircraft deliveries, but a number of positive and negative factors apparently went into the figure. The drop in projected sales was distorted because it was not adjusted for inflation nor for the opposite effect that the forecast period contained one less year. In addition, Boeing believes that the market will tilt toward smaller, less expensive airplanes.


Boeing said that world air travel will grow by 5.4% annually, a slight increase from the 5.2% projected last year. That outlook contrasts with that of some airline experts who worry that air travel growth may slow because of higher ticket prices, tighter corporate cost controls on travel and more frugal consumer spending.

“Optimism still abounds,” said Don Scales, director of the aerospace practice at the consulting firm Arthur D. Little. Aircraft demand “is going to be lower than that.”

Boeing expects airline profitability will continue a long historic drop. Boeing projected that yields--a measure of airline profitability--will drop 0.8%, somewhat worse than the 0.3% decline forecast last year.

Richard Albrecht, executive vice president of Boeing’s commercial airplane group, said air travel picked up in 1992 after a decline in 1991. For many U.S. carriers, he said, “some of this growth came at the expense of yield (revenue per mile) because of the economic climate and the airlines’ competitive situation.”


Airlines have lost about $10 billion in the last three years, including $8 billion at U.S. firms.