Airbus expects global air travel to grow by a 3.6% compound annual growth rate over the next 20 years, according to the latest edition of its global market forecast (GMF) issued July 11 in the run-up to the Farnborough Airshow.

The forecast is a significant cut to the guidance given in the 2021 GMF when Airbus still predicted aviation will grow by 3.9%. The latest edition of its long-term forecast, which is the basis for its own production planning and a reference document for suppliers, takes into account for the first time expected policies driving aviation to more sustainability and its net zero emissions target by 2050—including their impact on important cost elements such as fuel. Policy will include decisions such as Europe’s sustainable aviation fuels (SAF) quotas or other moves that are changing the economic equation of aviation in significant ways.

Airbus predicts that the in-service fleet will grow from 22,880 aircraft at the beginning of 2020 to 46,390 in 2041. Of the aircraft operating today, 7,400 will still be flying. To replace retirements,15,440 additional aircraft will be needed while 24,000 are going to be ordered to enable the sector to grow. 

Combined, airlines and lessors will take delivery of 39,490 aircraft over the next 20 years. The number is around 500 units higher than it was in the 2021 GMF, an effect mainly caused by the low number of deliveries in 2021 and the much higher output expected for 2041.

Of these, 31,620 aircraft are going to be narrowbodies, representing 80% of the market by units, 7,870 will be medium-sized and large widebodies. The share of narrowbodies continues to grow significantly from the most recent mark of just 76%, reflecting among others the foray of narrowbodies like the Airbus A321XLR into long-haul markets. In the widebody field, Airbus sees a short- to medium-term shift to smaller models. Bob Lange, the company’s head of forecasting, says similar trends could be observed after the Sept. 11, 2001, terrorist attacks after which airlines preferred smaller long-haul aircraft, a trend that has continued in nuances.

However, Airbus assumes that “short-term pressures” like very high costs of energy and the high inflation rates will “normalize within a few years.” For example, during the several years of low oil prices some producers have exited the market because it was no longer profitable. Lange assumes that high oil prices will reverse that over time.

Nonetheless, rising energy costs are a core assumption for the GMF. Airbus is trying to include regional price differences and estimates of SAF pricing. The manufacturer believes that airlines will pass through the rising costs to consumers. Historically, around 80% of fuel price increases have been paid for by passengers.

In the cargo market, express freight will continue to grow in importance from about one-sixth of all cargo to a quarter by 2041. The global freighter fleet will grow from about 2,030 to 3,070, according to Airbus estimates. When retirements are taken into account, airlines will need to order 2,440 new or converted aircraft. The share of new aircraft will be higher in the widebody segment.