Boeing Raises China Demand Expectations By 6.3% On Pandemic Recovery, Improved Infrastructure

Boeing Co BA has revised its forecast for the number of planes Chinese airlines will need through 2039 by 6.3% to 8,600 from the previous estimate of 8,090, Reuters reported Wednesday.

What Happened: The increased estimates for Chinese demand come after the Seattle-based planemaker cut its 20-year forecast for global airplane demand, according to Reuters.

Boeing reportedly attributed the higher numbers to China’s recovery from the pandemic, which has outpaced the rest of the world, and the Chinese government’s investments in improving and expanding the Asian country’s transportation infrastructure.

“While COVID-19 has severely impacted every passenger market worldwide, China’s fundamental growth drivers remain resilient and robust,” said Richard Wyne, managing director of China Marketing for Boeing Commercial Airplanes, as per Reuters.

Why It Matters: The airframer projects the world would need 6,450 new single-aisle planes over the next 20-years, while China’s widebody fleet needs 1,590 aircraft, which makes up for 18% of total deliveries, noted Reuters. 

Meanwhile, Boeing has been bleeding orders for its soon-to-be ungrounded 737 MAX jet, with 12 orders removed this week.

The planemaker lost or removed 1,043 orders for 737 MAX last month. 

The beleaguered aircraft was involved in two fatal crashes that killed 346 people and could be allowed back into the skies by the U.S. Federal Aviation Administration as early as Nov. 18, as per Reuters.

Price Action: Boeing shares closed nearly 3.5% lower at $182.15 on Wednesday and fell 0.69% in the after-hours session.