Airbus Revises 20-Year Jet Demand Forecast Down by 1% Citing Geopolitical Tensions

Airbus announced on Wednesday that it has trimmed its 20-year, industry-wide forecast for passenger jet demand by 1%. The world's largest planemaker cited the Iran war and ongoing trade tensions as key factors that have slowed the strong rebound in airline activity seen since the COVID-19 pandemic. According to Antonio Da Costa, Airbus's head of market analysis, the post-COVID recovery has "effectively flattened."

The revised forecast projects a total of 42,060 new passenger jet deliveries across the industry between 2026 and 2045. This includes 33,920 single-aisle aircraft and 8,140 wide-body jets, with both categories seeing a 1% decrease from the previous forecast. Airbus also noted that a higher proportion of these deliveries, 47% up from 45%, will be to replace older aircraft rather than to expand existing fleets.

Despite the overall reduction, Asia is expected to remain the dominant market, accounting for approximately half of all new aircraft deliveries. The forecast highlighted regional variations, with the annual domestic traffic growth forecast for India being revised upwards to 9.1% from 8.9%. In contrast, the growth forecast for China's domestic market was lowered to 4.7% from a previous 5.4%.

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Analysts suggest the lowered long-term outlook points to a more moderate aviation market, as airlines adjust capacity growth plans in response to factors like higher oil prices. The new delivery projections may be just sufficient to accommodate the production plans of Airbus and its main rival Boeing, potentially easing recent aircraft shortages in the coming years. The company also noted that Middle Eastern hubs are returning to normal traffic volumes amid a fragile ceasefire in the region.