Presented by: Andrew Gordon Director Strategic Marketing & Analysis · 2019. 8. 18. · Real GDP (CAGR* 1995 -2012) * Compound Annual Growth Rate . Economic growth catalyst . 0%

© AIRBUS all rights reserved. Confidential and proprietary document.

Global Market Forecast Drivers & Results

Global Market Forecast 2014-2033 Presented by: Andrew Gordon

Director Strategic Marketing & Analysis

Airbus GMF14 - Flying on Demand September 14

© AIRBUS all rights reserved. Confidential and proprietary document. September 14 Airbus GMF14 - Flying on Demand

Aviation’s benefit -

23 minutes

2 hours

4 – 12 hours

20 hours

The first commercial flight was 100 years ago


Oil Crisis Oil Crisis Gulf Crisis AsianCrisis 9/11 SARS

73%

Financial Crisis

September 14

Air travel has proved to be resilient to external shocks

Source: ICAO, Airbus

73% growth through multiple crises over the last ten years

World annual traffic (RPKs - trillions)

0.0

1.0

2.0

3.0

4.0

5.0

6.0

1968 1973 1978 1983 1988 1993 1998 2003 2008 2013


0

5

10

15

20

25

1980 1985 1990 1995 2000 2005 2010

World inflation adjusted average yield stabilising after strong decrease in the 80s and the 90s

Cents per RPK in 2013 US$

Source: ICAO, IATA, Airbus

Fairly stable


More movements, more connectivity….

Source: OAG, Airbus

Airport movements Airport connectivity

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013

Avg. number of movements per airport Avg. number of destinations per airport

0

2

4

6

8

10

12

14

1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013

x2.4 x1.8


More seats, more seats filled…

Source: OAG, Ascend, Airbus

Offered seats per aircraft

0

50

100

150

200

250

1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013

Avg. number of offered seats per aircraft (000)

50%

55%

60%

65%

70%

75%

80%

85%

1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013

World passenger load factors (%)

Source: ICAO, OAG, Airbus

Load factors

+17.4 percentage

points


Less fuel burn, therefore less emissions…

Source: ICAO, IATA, Airbus

Fuel consumption CO2 emissions

0

20

40

60

80

100

120

2000 2002 2004 2006 2008 2010 2012

Kilograms per passenger per trip (avg.) Kilograms per passenger per trip (avg.)

0

50

100

150

200

250

300

350

2000 2002 2004 2006 2008 2010 2012

-31% -31%

© AIRBUS all rights reserved. Confidential and proprietary document. September 14

High oil prices here for the long term…

Source: IHS Global Insight Energy, Airbus

* Currency in nominal terms

Brent oil price (nominal US$ per bbl)

0

20

40

60

80

100

120

140

160

180

1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030

Forecast History


-4%

-2%

0%

2%

4%

6%

8%

J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N J M M J S N-4%

-2%

0%

2%

4%

6%

8%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

World real GDPWorld passenger traffic (ASKs)

Passenger traffic is outperforming GDP growth

% (year-over-year)

2008 2009 2010 2011 2012 2013 2014

World real GDP and passenger traffic

Source: IHS Global Insight, OAG, Airbus

+5.6%

August 2014 Passenger Traffic

September 14


-4%

-3%

-2%

-1%

0%

1%

2%

3%

4%

5%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Underlying drivers indicate a positive economic outlook

Airbus GMF14 - Flying on Demand

Year-over-year quarterly evolution (%)

Source: IHS Global Insight, Airbus * Values corrected for inflation

World GDP*

Page 10 September 14


The World of 2033 will be very different from today

September 14 Airbus GMF14 - Flying on Demand

1- US 2- China 3- Japan 4- Germany 5- France 6- UK 7- Brazil 8- Russia 9- Italy 10- India

Source: IHS Global Insight, Airbus

1- China 2- US 3- India 4- Japan 5- Germany 6- UK 7- France 8- Brazil 9- Russia 10- Italy

1- China 2- US 3- India 4- Japan 5- Brazil 6- Germany 7- UK 8- Russia 9- France 10- Indonesia

GDP ranking based on nominal GDP expressed in US$

2013 2023 2033

Page 11

© AIRBUS all rights reserved. Confidential and proprietary document. Airbus GMF14 - Flying on Demand

A two-speed economic world

* 54 emerging economies

** 32 advanced economies


Comparison of year-over-year GDP growth

-4%

-2%

0%

2%

4%

6%

8%

10%

1982 1986 1990 1994 1998 2002 2006 2010 2014 2018

Emerging economies*

Real GDP growth (%) History Forecast Emerging economies will continue to lead the pack

Advanced economies**



Diverse emerging economies spread across the globe

September 14


Emerging economies (54 countries) All other countries (150 countries)

Page 13


Emerging economies are driving future growth


* Nominal GDP in US$

2033

Today

Emerging economies (54 countries) All other countries (150 countries)

54% 67% 59% 50%

36% 69% 42% 38%

Page 14

GDP Population Passengers trips

In-service fleet


Emerging regions will account for the largest share of origin and destination traffic worldwide

Source: ICAO, Sabre GDD, Airbus GMF

0

2

4

6

8

10

12

14

16

2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033

World annual RPK (trillion)

2.6% p.a. Advanced – Advanced

5.0% p.a. Emerging – Advanced

6.8% p.a. Emerging – Emerging

Airbus GMF 2014

ICAO total traffic


Air transport growth is highest in expanding regions

Billions of people will increasingly want to travel by air

China India Middle East Asia Africa CIS Latin America Eastern Europe

Western Europe North America Japan

Yearly RPK growth 2014 - 2033

1 billion

people 2014

6.2 billion

people 2014

Em

ergi

ng/D

evel

opin

g A

dvan

ced

+6.0 %

+4.2 %



Urbanisation to increase

49%

60%

67%

0%

10%

20%

30%

40%

50%

60%

70%

80%

-

1

2

3

4

5

6

7

8

9

10

1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

RuralUrbanUrban share

billion History Forecast

Urban population: 1.3B 2.3B 3.5B 5.0B 6.4B

World population and share of urban agglomeration evolution

Source: UN population division, Airbus


Global Middle Class to more than double

679 697 673 264 261 252

1,413

2,782

4,450

0

1,000

2,000

3,000

4,000

5,000

2013* 2023 2033

Global Middle Class** (Millions of people)

Emerging countries

World Population

% of world population

8,500

63%

7,900

48%

7,200

33% Source: Kharas and Gertz, Airbus * EOY 2013 ** Households with daily expenditures between $10 and $100 per person (at PPP)

3,740

2,356

5,375

North America Europe


Page 18


0.01

0.10

1.00

10.00

0 10 20 30 40 50 60

2013 trips per capita

North Americans and Europeans are the most willing to fly today…

Source: Sabre (annualized September 2013 data), IHS Global Insight, Airbus |

*Passengers originating from respective country

Bubble size proportional to population

2013 GDP per capita (thousands $US)

Europe ~1 trip per capita

North America 1.6 trips per capita

China 0.25 trips per capita

India 0.06 trips per capita

22% of the population of the emerging countries took a trip a year in 2013


Page 19


0.01

0.10

1.00

10.00

0 10 20 30 40 50 60

…but by 2033, China’s potential will reach European levels

Source: Sabre (annualized September 2013 data), IHS Global Insight, Airbus |

*Passengers originating from respective country

Bubble size proportional to population

66% of the population of the emerging countries will take a trip a year in 2033

2033 trips per capita

2033 GDP per capita (thousands $US)

India 2033 0.26 trips per capita

China 2033 0.95 trips per capita


Page 20


International tourist arrivals expected to reach 1.6 billion people by 2020

Source: World Tourism Organization, Airbus

1.6 billion tourists arrivals expected by 2020

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

1995 2000 2005 2010 2015 2020

International tourist arrivals (million) Forecast History

47%

Page 21


Tourism stimulates economic and air transport growth

September 14

Source: World Tourism Organization, OAG, IHS Global Insight, Airbus

0%2%4%6%8%

10%12%14%16%18%20%

0% 2% 4% 6% 8% 10% 12% 14%

International tourist arrivals (CAGR* 1995-2012)

Real GDP (CAGR* 1995-2012)

* Compound Annual Growth Rate

Economic growth catalyst

0%2%4%6%8%

10%12%14%16%18%20%

0% 2% 4% 6% 8% 10% 12% 14%

International tourist arrivals (CAGR* 1995-2012)

ASKs (CAGR* 1995-2012)

Air transport growth catalyst


International students have taken advantages of increased mobility

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

1975 1980 1985 1990 1995 2000 2005 2009

International students (Thousands) International Students / World population ratio (Base 1 in 1975)

Source: OECD, UN Population Division, Airbus

Number of international students and share of World Population

Page 24


Long-haul traffic grows stronger than short haul traffic

Source: OAG

* Long haul traffic: flight distance >2,000nm

Evolution of long-haul vs short-haul traffic (ASKs), 1973-2013, (Base 100 in 1973)

0

100

200

300

400

500

600

700

800

900

1000

1973 1978 1983 1988 1993 1998 2003 2008 2013

Since 1973, Long-haul traffic has

grown 1% per year faster than short-haul traffic

x6.2

Short-haul traffic

x9.1

Long-haul traffic

Page 25


42 Aviation Mega-Cities in 2013

• >50 000 daily long-haul passengers • >20 000 daily long-haul passengers • >10 000 daily long-haul passengers

2013 Aviation Mega-Cities

42 Aviation

Mega-cities

Source: McKinsey, UNPD, Airbus GMF

0.8M Daily Passengers: Long Haul traffic to/ from/via Mega

Cities

90%+ of long-haul

traffic on routes to/from/via 42 cities

22% of World

GDP in 2013



Larger aircraft will help Aviation mega-cities and their airports grow and prosper

*Aviation Mega-Cities International Airports

IATA WSG level 1: airport infrastructure is adequate

IATA WSG level 2: airports with potential for congestion

IATA WSG level 3: airports where conditions make it impossible to meet demand

2013 Aviation Mega-Cities*

Source: IATA WSG database, Airbus GMF

On the 42 Aviation Mega-Cities’ airports in 2013, 36 have scheduling constrained today

Page 28


The bigger the city, the wealthier the population 2013 Aviation Mega-Cities and 2013 GDP per capita (real 2010 $US, thousands)

0

20

40

60

AMC Otherlargecities

Region

North America (12 AMC)

05

10152025


Region 0

5

10

15


Region

0

20

40

60


Region 010203040


Region

0

10

20

30


Region

010203040


Region

Latin America (2 AMC)

Europe (9 AMC)

Africa (1 AMC)

Middle East (4 AMC)

CIS (1 AMC)

Asia-Pacific (13 AMC)

GDP per capita in Aviation mega-cities

x4 vs. World average

Source: McKinsey, UNPD, IHS Global Insight, Airbus GMF

Other large cities: urban agglomerations with a population above 300,000 people

Page 29


Routes between Aviation Mega-cities have higher percentages of premium pax

Percentage of premium passengers between AMCs

13%

0%

2%

4%

6%

8%

10%

12%

14%

Aviation Mega-City to AviationMega-City

Aviation Mega-City Secondary City

Secondary City to SecondaryCity

Percentage of premium passengers on route types Based on 2012 Aviation Mega-Cities

Source: SABRE, Airbus Market Research and Forecasts| Cities with more than 10,000 daily passengers, Long-haul traffic: flight distance >2,000nm, excl. domestic traffic


… and 91 Mega-Cities by 2033

• >50 000 daily long-haul passengers • >20 000 daily long-haul passengers • >10 000 daily long-haul passengers

2033 Aviation Mega-Cities

Source: McKinsey, UNPD, Airbus GMF

91 Aviation

Mega-cities

2.2M Daily Passengers: Long Haul traffic to/ from/via Mega

Cities

95%+ of long-haul

traffic on routes to/from/via 91 cities

35% of World

GDP in 2013



Airbus Global Market Forecast


A 20 year aircraft demand and passenger traffic forecast

Airlines • Business Models • Operations • Competition • Geopolitics

Trends Analysis • Consumer & Travel

Surveys • Tourism • Migration • Traffic flows • Passenger demands

Governments & Regulators

• Liberalization/ deregulation • Investments and

constraints • Geopolitics

Market Research

Network Development • Route planning • Origin and destination

demand • Population centers

Traffic • Economics and

Econometrics • Fuel costs • Yields • Load Factors • Trade and Value of Goods

Fleet trends • Aircraft economics • Utilization • Fleet age and retirements

Forecast

Page 32


Air traffic will double in the next 15 years

Source: ICAO, Airbus GMF 2014

0

2

4

6

8

10

12

14

16

1973 1978 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 2033

World annual RPK* (trillion) Airbus GMF 2014

ICAO total traffic

4.7%

2013-2033



Domestic PRC to become number one within 10 years

* 20-year annual growth rate (CAGR) Source: Airbus GMF

- 500 1,000 1,500 2,000

Sub Sahara Africa - Western EuropeAsia Advanced - Asia Emerging

Asia Emerging - Middle EastIndian Sub-Continent - USA

Central Europe - Western EuropeAsia Emerging - PRCSouth America - USA

Western Europe - South AmericaPRC - USA

Western Europe - PRCDomestic Brazil

Western Europe - Middle EastIndian Sub-Continent - Middle East

Domestic IndiaAsia Emerging - Western Europe

Domestic Asia EmergingWestern Europe - USA

Intra Western EuropeDomestic USADomestic PRC

Billion RPKs 20-year annual growth* 7.1% 1.9% 2.9% 2.9% 6.9% 4.0% 9.5% 6.8% 4.6% 6.0% 5.6% 6.6% 4.3% 5.3% 7.5% 5.4% 6.4% 6.8% 5.6% 4.3%


Domestic PRC to become number one within 10 years

* 20-year annual growth rate (CAGR) Source: Airbus GMF 2014

- 500 1,000 1,500 2,000

Domestic USAIntra Western Europe

Western Europe - USAAsia Emerging - Western EuropeWestern Europe - South America

Sub Sahara Africa - Western EuropeWestern Europe - Middle East

South America - USACentral Europe - Western Europe

Western Europe - PRCAsia Advanced - Asia Emerging

Domestic BrazilIndian Sub-Continent - USA

PRC - USAAsia Emerging - Middle East

Indian Sub-Continent - Middle EastDomestic Asia Emerging

Domestic PRCAsia Emerging - PRC

Domestic India

20132033

2013 – 2033 Billion RPK 20-year annual growth* 9.5% 7.5% 7.1% 6.9% 6.8% 6.8% 6.6% 6.4% 6.0% 5.6% 5.6% 5.4% 5.3% 4.6% 4.3% 4.3% 4.0% 2.9% 2.9% 1.9%



Asia-Pacific to lead in world traffic by 2033

Source: Airbus GMF 2014

RPK traffic by airline domicile (billions)

0 1,000 2,000 3,000 4,000 5,000

Asia-Pacific

Europe

North America

Middle East

Latin America

CIS

Africa

30%

25%

24%

8%

5%

4%

3%

5.7%

3.6%

2.9%

7.1%

5.4%

5.4%

4.7%

% of 2013 world RPK

20-year growth

36%

20%

17%

13%

6%

5%

3%

% of 2033 world RPK

2013 traffic 2014-2033 traffic

20-year world annual traffic growth

4.7%



Global Market Forecast 2014: Highlights GMF 2014 key numbers and 20-year change

World Fleet Forecast 2013 2033 % change 2013-2033

RPK (trillion) 5.8 14.6 151%

Passenger Aircraft Fleet 16,855 34,818 107%

New passenger aircraft deliveries 30,555

Dedicated Freighters 1,605 2,645 65%

New freighter aircraft deliveries 803

Passenger aircraft (≥ 100 seats)

Jet freight aircraft (>10 tons)

Source: Airbus GMF

New aircraft deliveries - +2,132 aircraft GMF 2014 vs. GMF 2013

Total New Aircraft Deliveries 31,358



Single-aisle: 70% of units; Wide-bodies: 55% of value

Passenger aircraft (≥ 100 seats) and jet freight aircraft (>10 tons)

Source: Airbus

31,400 New Deliveries GMF 2014 -2033

0

4,000

8,000

12,000

16,000

20,000

24,000

Single-aisle Twin-aisle Very Large Aircraft

1,500

7,800

22,100

70% 25% 5% % units

45% 44% 11% % value

20-year new deliveries of passenger and freighter aircraft



31,400 New

aircraft

6,100

12,400

19,000

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

Beginning 2014 2033

Demand for around 31,400 new aircraft

Stay in service

Replacement

Growth

Source: Airbus

Note: Passenger aircraft ≥100 seats, Freighter aircraft ≥10 tonnes

Airbus GMF14 - Flying on Demand

Fleet in service evolution; 2014-2033

18,500

37,500



…to estimate global demand

Source: GMF 2013

Worldwide Demand - Single-aisle:

22,071 Twin-aisle & VLA:

9,287

20-year demand by category

North America

Latin America

Africa

Europe CIS

Middle East

Asia Pacific

Aircraft Demand

Single-aisle

Twin-aisle/ VLA

Total aircraft

5,871

2,242

2,294

6,253

1,241

985

12,472

Page 40


Airbus backlog well aligned with demand forecast

Source: Airbus, Airbus GMF

As at end August 2014

Total backlog includes undisclosed

Airbus backlog - 5,892 aircraft



Summary

• Strong growth in passenger traffic – resilient growth through a difficult, but improving economic period

• Demand for 31,400 new aircraft by 2033 – ~30,600 passenger aircraft and nearly 800

freighter aircraft

• Replacement of ageing fleets – 20 year demand for 12,400 passenger aircraft for replacement, largely in the single-aisle segment

• Single-aisle aircraft represent 70% of demand in units, but wide-body aircraft represent 55% of value

• VLA demand driven by aviation mega-cities – more than 95%+ of all long-haul passengers will fly to, from or through 91 aviation mega-cities by 2033


Global Market ForecastThe first commercial flight was 100 years agoAir travel has proved to be resilient to external shocksWorld inflation adjusted average yield stabilising after strong decrease in the 80s and the 90sMore movements, more connectivity….More seats, more seats filled…Less fuel burn, therefore less emissions…High oil prices here for the long term…Passenger traffic is outperforming GDP growthUnderlying drivers indicate a positive economic outlookThe World of 2033 will be very different from today A two-speed economic worldDiverse emerging economies spread across the globeEmerging economies are driving future growthEmerging regions will account for the largest share of origin and destination traffic worldwideAir transport growth is highest in expanding regionsUrbanisation to increaseGlobal Middle Class to more than doubleNorth Americans and Europeans are the most willing to fly today……but by 2033, China’s potential will reach European levels International tourist arrivals expected to reach 1.6 billion people by 2020Tourism stimulates economic and air transport growthInternational students have taken advantages of increased mobilityLong-haul traffic grows stronger than short haul traffic42 Aviation Mega-Cities in 2013Larger aircraft will help Aviation mega-cities and their airports grow and prosperThe bigger the city, the wealthier the populationRoutes between Aviation Mega-cities have higher percentages of premium pax… and 91 Mega-Cities by 2033Airbus Global Market ForecastAir traffic will double in the next 15 yearsDomestic PRC to become number one within 10 yearsDomestic PRC to become number one within 10 yearsAsia-Pacific to lead in world traffic by 2033Global Market Forecast 2014: HighlightsSingle-aisle: 70% of units; Wide-bodies: 55% of valueDemand for around 31,400 new aircraft…to estimate global demandAirbus backlog well aligned with demand forecastSummarySlide Number 43

Documents

Presented by: Andrew Gordon Director Strategic Marketing & Analysis · 2019. 8. 18. · Real GDP (CAGR* 1995 -2012) * Compound Annual Growth Rate . Economic growth catalyst . 0%