**Title: Airbus Adjusts Long-Term Aircraft Demand Forecast Amid Global Challenges**
Airbus (AIR.PA) announced on Wednesday a revision of its 20-year forecast for passenger aircraft demand, reducing it by 1% due to the ongoing Iran conflict and rising trade tensions, which have hindered the recovery of airline activity post-COVID-19. The company, recognized as the world’s largest planemaker, indicated that while it still anticipates strong demand for jets, particularly from Asia, the geopolitical climate has tempered earlier growth expectations.
Antonio Da Costa, head of market analysis at Airbus, explained that the anticipated post-pandemic recovery has "effectively flattened," reflecting the impact of recent crises on airline capacity growth plans. The increase in oil prices linked to the Iran war has further complicated the industry’s recovery trajectory.
In its updated forecast, Airbus projects a total of 42,060 passenger jet deliveries from 2026 to 2045, a slight decrease from its previous estimate. This figure includes 33,920 single-aisle jets, a segment dominated by the Airbus A320neo family and Boeing’s 737 MAX, as well as 8,140 wide-body or long-haul jets. The adjustments suggest that while production plans from Airbus and Boeing are ambitious, they may not fully account for the competition posed by China's emerging C919 aircraft, potentially alleviating current aircraft shortages in the future.
Airbus also noted a shift in the nature of deliveries, with an increased proportion—47% compared to the previous 45%—expected to replace older aircraft rather than expand existing fleets. Despite the downward revision in long-term demand, the company raised its forecast for annual passenger traffic growth to 3.9%, up from 3.6%. However, this figure represents a decrease from the previously projected 4.1% growth rate on a like-for-like basis.
The Middle East, particularly its Gulf hubs, is showing signs of recovery, with traffic volumes returning to normal levels amid a fragile ceasefire in the Iran conflict. The region remains a critical area for growth, while India continues to lead as the fastest-growing air travel market. Airbus has increased its forecast for annual domestic traffic growth in India to 9.1%, up from 8.9%. Conversely, the outlook for China’s domestic market has been adjusted downward to 4.7% from 5.4%.
Both Airbus and Boeing maintain that the aviation sector has demonstrated resilience in the face of various global shocks, from the September 11 attacks to the financial crisis and the COVID-19 pandemic. However, as the industry matures, long-term growth rates are beginning to stabilize, with airlines increasingly opting to operate existing jets for longer periods or maximizing passenger capacity through more efficient configurations. The introduction of artificial intelligence in operations may further enhance efficiency in the sector.
Analysts suggest that the forecasts provided by Airbus and Boeing play a significant role in shaping investment trends within the aviation industry. While these projections have historically been reliable, the evolving nature of the data reflects changing priorities in air travel. Recently, Airbus has emphasized the importance of secondary cities, promoting smaller aircraft such as the A220 and the narrow-body A321XLR, which can effectively serve routes that bypass major hubs. This marks a notable shift from a decade ago when the focus was on the significance of “megacities” and the production of the A380 superjumbo, which has since ceased due to declining demand.
As Airbus navigates these challenges, the company remains committed to adapting its strategies to meet the evolving landscape of global air travel. The adjustments in forecasts underscore the complexities faced by the aviation industry as it seeks to balance recovery with emerging geopolitical and economic realities.