The market for commercial planes in China is taking off, Boeing Co. said in a report last week, even as tariffs are affecting trade between that country and the United States.
Boeing said China will be the world's largest aviation market over the next 20 years, buying 7,690 planes worth $1.2 trillion to meet the country's growing consumer demand. About one of every five planes sold over the next two decades will be to carriers in China, according to the aerospace firm's projections.
More than three-fourths of China's demand will be for single-aisle planes like Boeing's workhorse 737. Another 1,620 orders will be for wide-bodies like the 787 Dreamliner that's built at Boeing's assembly campus in North Charleston and in Everett, Wash. Those orders would triple the country's current wide-body fleet.
The forecast, which extends through 2037, is 6.2 percent higher than Boeing's projections a year ago.
Randy Tinseth, vice president of marketing for Boeing's commercial airplane division, said the growth in China is due to a middle class that has more than tripled over the past 10 years and is expected to double again in the next decade.
"The future of commercial aviation in China is very exciting," Tinseth said in a statement.
According to a Bloomberg News report, the $12.2 trillion Asian economy is crucial to Boeing and European rival Airbus as mainland carriers expand capacity and add new global destinations. The nation accounted for about 13 percent of Boeing’s revenue last year, according to data compiled by Bloomberg.
"We have about 100 million new passengers, people who fly for the first time, every year in Asia," Boeing CEO Dennis Muilenburg said during an investor's conference last week in California. "So the opportunity for growth is tremendous."
Boeing and Airbus have opened manufacturing plants in China in an effort to better capture that country's market share.
Trade tensions have hit several manufacturing sectors including South Carolina's automotive market, with China placing a 25 percent tariff on vehicles — such as BMWs made the automaker's Upstate plant — that are imported from the United States. Those tariffs are in retaliation for similar duties President Donald Trump imposed on Chinese goods.
So far, however, China has not put large aircraft on its list of products subject to higher tariffs — a move that could give Airbus an advantage over Boeing in sales.
Muilenburg told investors last week that trade discussions between the two countries are "exceptionally important" to Boeing.
"I think the key is that we have a voice at the table," he said. "We've been engaged, we've been invited in as part of the dialog and we've had strong discussions with both U.S. leadership and China leadership. Both countries are motivated to have a healthy aerospace industry."
Boeing delivered a record 202 aircraft to China in 2017, marking the sixth consecutive year the aerospace giant has delivered more than 140 planes to the country.
Globally, Boeing has projected a need for about 43,000 new commercial aircraft over the next 20 years, up about 1,700 airplanes from last year's estimate.