Worldwide Market Forecast (2018 ) Prompt Report June 2018 Marketing Group Japan Aircraft Development Corporation
Outline of the Worldwide Market Forecast Jets and turboprop Passenger jet 20 seats and above Passenger turboprop 15 seats and above Jet freighter All regions of the world 13 regions (passenger) North America, Latin America, Western Europe, Eastern Europe, Middle East, Africa, Japan, China, Northeast Asia, Southeast Asia, South Asia, Oceania and CIS 7 regions (freighter) North America, Latin America, Europe, Middle East, Africa, Asia-Pacific and CIS Scheduled and non-scheduled flight Top-down analysis 2
World Economic Forecast by Region Global Economy (Real GDP) will grow by 2.79% per annum. ( It was 2.84% in the last year data.) World Asia/Pacific North America Europe Breakdown of Europe Westen Europe Eastern Europe 2.00% 2.23% 1.72% 1.81% 1.62% 1.71% 2.79% 2.87% 2.73% 3.14% 3.89% 4.37% 2018 1998 Breakdown of Asia/Pacific Japan Oceania China North East Asia South East Asia South Asia 0.86% 0.75% 2.43% 2.08% 3.01% 3.86% 4.81% 4.39% 4.37% 5.86% 6.61% 8.79% Middle East 3.40% 3.93% Latin America Africa CIS 1.94% 2.97% 2.46% 3.43% 4.15% 3.69% 0% 1% 2% 3% 4% 5% 6% 7% 8% 9% 10% Real GDP Growth Rate per annum Source : IHS 3
Effect of Crude oil price on RPK The oil prices will have much effect on a growth of RPK. JADC have made a moderate case and estimated RPK. Average Spot Price (US$/bbl.) 250 200 150 100 50 Brent Crude Oil Price (Average Spot Price) JADC (1.3%.p.a) RPK ( 10 9 ) 25000 0 1990 2000 2010 2020 2030 2040 Source : EIA 20000 EIA High Oil Price Case EIA Reference Case JADC EIA Low Oil Price Case Effect of Crude oil price on RPK (via Yield only) (via Yield only) Δ(Log RPK) = a Δ(Log GDP) + b Δ(Log Yield) 15000 10000 5000 0 EIA Low JADC EIA Ref EIA High 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2019 2021 2023 2025 2027 2029 2031 2033 2035 '17 '37 Ave.Growth Rate 4.6% 4.5% 4.3% 3.9% 1997 5.0% 4
Trend of Retirement (Passenger Jets) Averaged age of retirement is 23.2 in, which is 5 years younger than 27.8 in 2005. Recently, a new crowd is emerging near 18. 23.2 5
Air Passenger Traffic and Fleet Forecast 6
(trillion RPKs) [RPK] World Passenger Traffic Forecast World Passenger Traffic will grow by 4.5% per annum. 20 Actual Forecast 18.6 16 12 2.4 times 8 5.0% p.a. 7.7 4.5% p.a. 4 2.7 times 0 1997 2002 2007 2012 2022 2027 2032 7
[RPK] Passenger Traffic Forecast by Region (2018 - ) Europe, North America and China will constitute three pillars in RPK of the world. Asia-Pacific Breakdown of Asia/Pacific (China) 5.6% 5.3% (Southeast Asia) 5.5% (South Asia) (Oceania) (Northeast Asia) 3.2% 2.7% 7.6% Traffic in Increase from 2018 to (Japan) Europe Breakdown of Europe (West Europe) 3.2% 3.5% 3.8% (East Europe) 7.3% North America 3.2% Middle East 6.0% Latin America 4.8% CIS 3.2% Africa 3.8% 0 1 2 3 4 5 6 7 8 RPK (Trillion) 8
Middle East 10% Japan China [RPK] Comparison of Shares by Region Asia-Pacific and Middle East Airlines will have more market shares. 3% 14% Latin America Africa 2% Oceania 3% 3% South Asia 7% Southeast Asia 5% 3% Share Others (20%) Asia-Pacific (32%) CIS 3% Northeast Asia North America 25% Europe (25%) 1% East Europe West Europe 23% Middle East Japan Africa 13% 2% 17% China Latin America 2% Oceania CIS Share 6% 2% Others (23%) Asia-Pacific (38%) 2% 6% South Asia North America 18% 9% Southeast Asia 7.7 trillion RPK 18.6 trillion RPK Europe (22%) 19% West Europe 2% East Europe 2% Northeast Asia 9
Load Factor (%) 2010 US cent/rpk 18 16 14 12 10 100 90 80 70 60 50 40 30 20 10 0 8 6 4 2 Parameters used for World Jet Fleet Forecast Real Yield Forecast ACTUAL West Europe World North America FORECAST 0 1997 2002 2007 2012 2022 2027 2032 Passenger Load Factor Annual Growth Rate (%) 1997- - North America -1.8% -0.6% West Europe -3.0% -0.6% World -2.2% -0.6% 1997 N.AMERICA EUROPE ASIA PACIFIC Japan WORLD World average real passenger yield will decline by 0.6% per annum. World average passenger load factor will approach 83% in. Category Size(seats) Aircraft Turbo 15-39 DHC6-400, Do228 prop 40-79 ATR42/72, DHC8-400, MA60 80-99 (ATR92) Jet 20-59 60-99 100-119 CRJ200/440, ERJ135/140/145 CRJ700/900/1000, ARJ21, SSJ100, EMB170/175E2/190E2, MRJ70/90 CS100, EMB195E2 A318, B737-600 120-169 170-229 230-309 310-399 A319ceo/neo, A320ceo/neo, B737MAX-7/-8, CS300, C919 A321ceo/neo, B737MAX-9/-10 B757 A330-800/-900, B787-8/-9 A300-600, B767-300/-400 A350-900/-1000, B777, B787-10 A340 400-499 B747 >500 A380 *Aircraft are segmented according to number of seats based on 1-class for turboprop and regional jet, 2-class for narrow body and 3-class for wide body. 10
World Passenger Jet Fleet Forecast (corrected) Industry will need 33,500 passenger jet airplanes in the next 20 years, valued at $ 5.1 trillion. 40,000 39,867 30,000 Growth 17,530 No. of Airplanes 22,337 20,000 52% Replacement 16,000 New Deliveries 33,530 10,000 48% Retained 6,337 0 11
No. of Airplanes 18,000 16,000 Regional Jet World Passenger Jet Fleet Forecast by Seat category Primary market is found in 120-169 Seats class. Narrow body Jet 16,930 Wide body Jet 14,000 12,000 Existing New Delivery Retained 11,845 Total Year-End: 22,337 Year-End: 39,867 2018- New Deliveries: 33,530 10,000 8,000 7,650 6,000 11,845 13,056 5,375 4,000 2,000 0 4,255 6,850 3,293 4,887 2,250 2,393 1,888 2,223 1,638 3,797 2,794 3,874 984 2,250 613 1,789 2,393 2,223 1,638 391 359 984 117 113 499 613 800 99 488 458 391 244 4 20-59 60-99 Seats Seats 100-119 Seats 120-169 Seats 170-229 Seats 230-309 Seats 310-399 Seats Over 400 Seats 115 12
N.of Airplanes 18,000 16,000 14,000 World Passenger Jet Fleet Forecast by Region Europe, North America and China constitute three pillars for the world market. 16,474 Total Fleet Year End: Year End: 2018- Deliveries: 22,337 39,867 33,530 12,000 10,000 8,000 7,564 7,694 14053 Existing New Delivery New Delivery Retained Retained 6,000 4,000 2,000 0 6304 6107 6431 1457 4585 1263 6987 2421 6745 3516 3345 1897 696 1552 541 1429 575 184 504154 291 627 100 507 658 140 2,654 3,131 1,003 1,347 2677 2350 1308 1464 829 1083 304 454 700 989 174 264 North America Europe Asia Pacific Japan China North east Asia South east Asia South Asia Oceania Middle East Latin America Africa CIS 13
5,000 World Turboprop Fleet Forecast Industry will need 2,700 passenger turboprop airplanes in the next 20 years, valued at $57 billion. 4,000 3,404 Growth 111 4% 3,515 No. of Airplanes 3,000 2,000 Replacement 2,569 96% New Deliveries 2,680 1,000 Retained 835 0 14
No. of Airplanes 2,000 World Turboprop Fleet Forecast by Seat category Largest market is found in 60-79 seat category. 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Total Year-End: 3,404 Year-End: 3,515 2018- New Deliveries 2,680 1,057 395 292 103 534 860 843 17 638 131 100 1,175 1,047 615 367 0 0 231 1,662 New Delivery New Retained Delivery Existing Retained 367 15-19 Seats 20-39 Seats 40-59 Seats 60-79 Seats 80-99 Seats 15
N.of Airplanes 1,600 1,400 1,200 World Turboprop Fleet Forecast by Region The demand will be widespread in many regions. 1501 Total Fleet Year End: 3,404 Year End: 3,515 2018- Deliveries: 2,680 1,000 800 1154 New Delivery New Delivery ExistingRetained Retained 600 400 200 0 713 338 115 453 549 397 547 152 North America Europe 999 347 Asia Pacific 45 77 57 12 21 5225 4217 529 361 444 306 242 249 149 197 345 44 60 75 31 83 3713 North South Japan China east east South Oceania Asia Asia Asia Middle East 444 Latin America 365 451 287 78 159 213112 47 Africa CIS 16
Air Cargo Traffic and Freighter Fleet Forecast 17
[RTK] World Cargo Traffic Forecast World cargo traffic will grow by 4.1% per annum 18
[RTK] World Cargo Traffic Forecast by Region Slow down in Middle East region, Accelerate in North America. 19
[RTK] Cargo Traffic Forecast by Market Asia Pacific will be the focal of Cargo Traffic. 20
[RTK] Comparison of Shares by Region Market share of Asia-Pacific and Middle East Airlines will increase. 2.2 billion RTKs 5.1 billion RTKs 21
Parameters Used for Freighter Fleet Forecast World average real cargo yield will decline by 0.7% annually. Lower-hold load factor will increase faster than freighter load factor. Narrowbody (<50 tonnes) Medium Widebody (50-70 tonnes) Large (>70 tonnes) BAe-146 DC-10-10 DC-10-30/40 CRJ100/200 767 MD-11 DC-8 787 777 DC-9 A300 747 MD-80 A310 A350 MD-90 A330 A380 727 IL-76 An-124 737 757 A320 A321 Tu-204 22
Jet Freighter Fleet Forecast New deliveries will be 2,524 planes. (New 1,048, Converted 1,476) 23
Jet Freighter Fleet Forecast by Size Category The number of large size freighters will be increased. (777, 747, A350, A380 etc.) 24
Jet Freighter Fleet Forecast by Region Freighter fleet of Asia-Pacific and Middle Eastern Airlines will grow 2.6 time. 25
Summary World Economic Growrh (GDP) Growth measures Sales ( US$billion) 2.8%p.a. Passenger Demand (billion RPKs) 7,737 18,587 4.5%p.a. Passenger Jet Airplane Fleet 22,337 39,867 2.9%p.a. New Passenger Jet Airplane Deliveries 33,530 5,137 Cargo Demand (billion FTKs) 227 508 4.1%p.a. Jet Freighter Fleet 1,864 2,951 2.3%p.a. New Jet Freighter Deliveries 1,048 353 Total New Jet Airplane Deliveries 34,578 5,490 Passenger Turboprop Airplane Fleet 3,404 3,515 0.2%p.a. New Passenger Turboprop Airplane Deliveries 2,680 57 New Engine Deliveries 84,021 1,237 26
For more information, visit our website: http://www.jadc.jp/en/data/forecast/ The statements contained herein are based on good faith assumptions and provided for general information purposes only. These statements made herein do not constitute an offer, promise, warranty, or guarantee of performance. Actual results may vary depending on certain events or conditions. This document should not be used or relied upon for any purpose other than that intended by Japan Aircraft Development Corporation. 27