Boeing: Asia Is Big Enough For New Narrowbody Rivals

AIN AIR TRANSPORT PERSPECTIVE » SEPTEMBER 3, 2012

by  NEELAM MATHEWS

Indonesian carrier Lion Air emerged as one of several big-spending Asian carriers this year when Boeing Commercial Airplanes vice president of Asia Pacific and India sales Dinesh Keskar (left) and Lion Air president Rusdi Kirana signed a big order for Boeing 737s at February’s Singapore Airshow.

September 3, 2012, 8:30 PM

With leasing companies taking positions on Boeing’s new 737 Max, the Asia-Pacific region holds the key to large narrowbody orders, according to Boeing’s senior vice president of sales for Asia Pacific and India, Dinesh Keskar. “We have three potential customers in India and more in Asia [that can take the Max] on lease or direct buy: Jet Airways, SpiceJet and even Air India Express,” he told AIN. “[The Max] can go 500 additional miles, which will be a big boon for the Asian market.”

Keskar said Boeing’s latest 20-year forecast for India reflects even stronger demand than the numbers from last year’s forecast suggested.

Like its direct rival Airbus, Boeing faces new competitors in the battle to expand the fleets of Asia’s ambitious carriers, mainly in the shape of Japan’s Mitsubishi Regional Jet, China’s Comac C919 twinjet, Russia’s Sukhoi Superjet 100 and Bombardier’s new CSeries. But Keskar insists the Asian market is growing quickly enough to accommodate the expanding group of suppliers. Boeing’s existing global market outlook shows that Asia accounts for 38 percent of all demand by dollar value and 35 percent in terms of aircraft units. “Our base [in Asia] is big,” said the senior Boeing sales executive in the region.

Keskar sees Indonesia as one of the fastest growing markets in Asia. In February this year, existing customer Lion Air ordered an additional 230 Boeing 737s, including 201 Maxs; twenty-nine 737-900ERs account for the remainder. Flag carrier Garuda plans to take delivery of four Boeing 777 widebodies next year.

Unfortunately, a worsening shortage of pilots and mechanics in the region has already forced some airlines to delay expansion plans and others to go as far as to cancel service and ground airplanes. The situation will only worsen if demand for air travel grows as rapidly as Boeing expects over the next two decades.

The 2012 Boeing Pilot & Technician Outlook, issued during July’s Farnborough International airshow, predicts a need for 185,600 new pilots and 243,500 new technicians in the Asia-Pacific region through 2030. According to the report, China alone needs 71,300 pilots and 99,400 technicians over the next 20 years, accounting for the largest demand in the region.

The Boeing outlook projects that Southeast Asia will require 51,500 pilots and 67,400 technicians over the next two decades, while Southwest Asia accounts for 31,000 pilots and 33,100 mechanics; Northeast Asia will need 18,800 pilots and 26,500 technicians over the 20 years; and Oceania will require 12,900 pilots and 17,100 technicians, according to Boeing.

In response, Boeing signed a memorandum of understanding in June with the Indonesian Ministry of Transportation to undertake an effort to establish training programs as part of the company’s effort to develop a global flight school network.