Aircraft manufacturers look to Asia

PHOTO

A Royal Australian Air Force F-111 flies past during a flight display at the Singapore Airshow 2010 in Singapore on February 2, 2010. The US aerospace industry is out in full force at the Singapore Airshow which opened in a bid to win more business in Asia, seen as the fastest-growing aviation market. [AFP]

Scott Alle

Last Updated: Mon, 8 Feb 2010 11:10:00 +1100

The world's biggest aircraft manufacturers are hoping for an Asian-led recovery for the trouble aviation sector.

Major companies like Boeing, Airbus and Lockheed Martin have been in Singapore to showcase their new and existing aircraft, after a turbulent year which saw passenger traffic down by 3.5 per cent for 2009, with freight traffic diving 10 per cent.

Jimmy Lau, the show's managing director, has told Radio Australia's Connect Asia program there's been some positive signs of recovery.

"The mood has been upbeat actually, although they are very very cautious at the beginning of the year, I think everyone is seeing what the trend might be," he said.

"The mood generally for last three days has been very upbeat."

That positive atmosphere comes off the back of ongoing concerns among the major manufacturers, with Seattle-based manufacturing giant Boeing sitting on a reported backlog of nearly 3,500 planes worth $US250 billion, and struggling carriers like Japan Airlines creating uncertainty over existing orders.

Boeing's vice president of marketing, Randy Tinseth, says low cost carriers represent the company's best source of growth.

"Since the year 2000 we've seen the low cost carriers consistently grow in markets," he said.

"We've seen those airlines consistently being profitable through this down cycle, we've seen those airlines grow and as we look at the next 20 years we see low-cost carriers growing faster than the network carriers."

Passenger traffic in Asia is projected to grow an average six per cent annually over the next 20 years, but concerns reamin over regional issues such as outdated infrastructure and the regional de-regulation of the industry.

One area where manufacturers are hopeful of making big deals is the expanding Chinese aviation market, with Air China alone expected to order 400 planes in the next five years.

However, Jimmy Lau says that expansion may also lead to more competition for the US and European-based manufacturers, with China keen to produce its own passenger jets.

"The Chinese commercial market is going to be very very huge," he said.

"And I think China and Comac are going to make sure their commercial jets are going to make a big impact, not just domestically you know but on the world stage."