P O C K E T

G U I D E

delivering the future

Global Market Forecast 2011-2030

Global Market Forecast 2011-2030

Executive Summary 12 Passenger Trafc 18 Demand for Aircraft 24

By Segment (SA, TA, VLA) By region

Population Growth/Urbanisation Network evolution Fuel Issue

Drivers & Challenges 32

Summary Results 44

Global Market Forecast

Passenger aircraft edition

2

delivering the future

Dear Reader, If you are reading this pocket guide, there is no doubt that you are interested in the future of civil aviation, with the majority of you, like us, passionate about the industry and keen to play a part in its continued positive development; not only for those directly involved in the business, but for the billions of passengers who today and in the future will need and have access to its benefits. There is no denying aviations importance in terms of social and economic growth and the huge strides it has taken in a very short space of time, not only in terms of supply, but environmentally, with each aircraft for example 70% more fuel efficient than just forty years ago. Aviation's value to the modern world was emphasised recently with the rapid recovery of passenger traffic following the worst financial crisis experienced for decades, a resilience that was also in evidence following prior economic cycles. This year, in order to make it easier for you to access the information in the Airbus Global Market forecast, we have also produced this pocket guide, a simple format from which to retrieve its key findings on the passenger fleet and future deliveries. Our forecast for the freight market will be published separately in future, reflecting its importance to Airbus and the industry. In producing GMF2011, it became clear that there are four key messages that it would be useful to highlight by means of an introduction Your forecasting team

People value flight,

The expression the miracle of flight is seldom heard these days, it is taken for granted that if we want to visit a client in the US, Europe or the emerging markets in Asia, we can affordably get on an aircraft and be there the next day. If we want to visit our friends or relatives who have moved away with their jobs for example, its easy, no more difficult than a few clicks of a mouse and a trip to the airport. But just because we dont say it much in todays modern world, it doesnt mean that flying is no longer a man-made miracle. If someone were to say that they were going to take you to an altitude where you couldnt breathe, where you would experience temperatures around -50 degrees, and then leave you there for anything between one and fourteen hours, you wouldnt be very keen to go with them. Yet that is exactly what 2 billion passengers do every year, without even a second thought, as they fly to every corner of the world. Even when economic crises or other events serve to dampen demand, as we have seen from time to time, people still need to fly, with air traffic quickly returning to more normal growth levels. Even during a period when aviation had three of its severest tests following 9/11, SARs, and the recent financial crisis, aviation still managed to grow 45%, a fact that can only mean people really do need and want to fly. What about the future? Airbus commissioned an international study of over 10,000 people around the world, who will be the passengers of 2050, and what they expect from air travel in the future. From these respondents, 69% said they expected to fly more, with the reasons in order of importance being, 1 economic growth, 2 a desire to see more of the world, 3 the need to see friends and family spread across the globe, and 4 greater exibility between home and the workplace. However, significantly, they also stated that reducing CO2 emissions was one of the top two areas where they would like and expect to see technological advances. The good news is, so do we. In the last 40 years, manufacturers

Global Market Forecast

but not at any cost

have reduced the fuel burn of aircraft and therefore CO2 emissions by 70%, noise by 75%, with work continuing to deliver further improvements. In the last ten years the demand for jet fuel has increased 3%, whilst traffic in terms of RPKs (Revenue Passenger Kilometres) has increased 45%. Aviation will continue to strive to become ever more eco-efficient, reducing fuel burn per aircraft to the benefit of the environment and airlines, who face the prospect of fuel being a significant portion of their operating costs in the years to come.

Air travel has proved to be resilient to external shocks

Financial Crisis
+45%

World annual traffic (RPKs - trillions)

Asian Crisis WTC Attack SARS Gulf Crisis Oil Crisis Oil Crisis

5.0 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0 1970

1975

1980

1985

1990

1995

2000

2005

2010

Source: ICAO, Airbus

More People will have access to the benets of flight

One component of traffic growth, as always, will be the existing travellers who will simply need to fly more. In a survey Airbus conducted recently on the future of flying, respondents suggested they expected to nearly double the number of times they flew each year in the future. However, with emerging economies around the world rapidly growing their economies and as a result growing the wealth of their citizens, more and more people will be able to benefit from
Trips* per capita - 2010
Bahamas Seychelles Maldives St Lucia Samoa Fiji Mauritius Malaysia Cape verde Costa Rica Jordan Chile Bahrain Trinidad Oman Portugal Malta Barbados Cyprus

Spain Greece Israel Brunei South Korea

Brazil

Latvia Saudi Arabia Czech rep. Hungary Slovakia

Bolivia

Russia China
Equatorial Guinea

Slovenia

Uruguay

Senegal

India
Angola

Belarus

World average

Liberia

Swaziland Bangladesh Iraq Lesotho Chad

Emerging economies: more people can y

*Passengers originating from respective country Note: GDP in 2005 US$ Source: IATA PaxIS, Global Insight, Airbus

00

00

00

00

Global Market Forecast

10, 0

20,0

25,0

15,0

5,0

00

aviation and fly for the first time. This effective and continuing democratisation of aviation, and something that is happening every day. Today, whilst having an aviation infrastructure that is already large and growing fast, the people of China take just 0.2 trips per person per year. This compared to the largest domestic aviation market in the world in the US, where their flying citizens take on average nearly 2 trips per person per year. Increasing wealth will however move these countries along the flight curve, flying more and helping to drive our forecast passenger traffic growth at a 4.8% average annual growth rate per annum over the next 20 years.

10
New Zealand HK UAE Italy France Japan Kuwait Singapore Australia Canada Germany UK Finland Macao Ireland USA Sweden Netherlands Iceland

Denmark

Switzerland

Belgium

0.1

0.01

2010 Real GDP per Capita

00

00

35,0 00

000

40,0

45,0

50,0

55,0

30,

00

00

70% of 2030 traffic volumes will be between expanding regions

RPK (trillion) 12.0 10.0 8.0 6.0 4.0 2.0 0 24% 76% 1970 Rest of world Traffic within & between USA, Canada, Western Europe and Japan
Source: Airbus GMF 2011

70%

57%

37% 63% 1990 43% 2010

30%

2030

Forty years ago, 76% of the worlds traffic flew from, to or between North America, Western Europe and Japan. Today, as more of the world has embraced flight and been able to take advantage of its benefits this share has dramatically reversed. Some 57% is now centered in other parts of the world. This is not to say that these original regions will not also grow, they will, almost doubling their traffic over our forecast period.

Global Market Forecast

3 Single-aisles connecting people

Single-aisle aircraft, like the A320 family and the 737NG, are a very significant part of todays aviation network. Taking aircraft above 100 seats, 87% of all routes are flown by single-aisles and 78% of all seats offered globally are on a single-aisle aircraft. They really do connect people. This is a broad segment, covering from about 100 seats to 210 seats. It is no surprise therefore that the most successful products in this market are those that offer a complete family, offering maximum choice and flexibility for airlines, with the largest of these very often needing the complete spectrum of size on offer. As single aisle aircraft are an important component of the fleet today and will still be in 20 years time, it is also no surprise that this segment should become the focus of new entrants and efforts to reduce the environmental impact of aviation. Today, there is an opportunity to further reduce the environmental footprint of these aircraft through new engine and aerodynamic technologies, but also to reduce their cost of operation by reducing fuel burn. This is also significant due to the fact that as fuel prices rise, fuel becomes an ever increasing share of an airlines operating costs. At Airbus, the A320neo will reduce fuel burn by 15% when it comes into service in 2015. Another big step in aviations development, magnified by the importance of this segment to the overall aviation network.

87% 78% 87% 78%

of all routes of seats of frequencies of the eet in 2010

73% 71%

of the eet by 2030 of new deliveries in the next 20 years

Aircraft 100 seats

Very Large aircraft connecting the world

Whilst a key design goal of new aircraft is to reduce the fuel that they burn and, therefore, the CO2 emitted, it is also important to scale the aircraft to market requirements and in particular, to the ever growing numbers of people who will have access to aviation and will fly between the increasing number of aviation mega-cities and hubs. By 2030, there will be 87 such cities, increasing from 39 in 2010, expansion driven by population growth and a rapidly urbanizing world. Today, about 50% of the worlds population lives in cities, by 2030, this will be nearly 60%. More importantly from an aviation perspective, 91% of the people flying longhaul in 2030 will want to fly to, from or between these very big points. These dense markets are exactly the ones for which the A380 was designed; offering the right capacity at the right operating cost and right fuel burn per seat for the airlines operating in these markets.

87 aviation "mega-cities" in 2030

Destinations with more than 10 000 daily long haul pax

Seattle

Dublin Detroit Boston Lisbon Dallas Philadelphia Barcelona Panama Bogota Lima Santiago Rio de Janero Accra

Vienna Istanbul Cairo Jeddah Lagos Nairobi

Tehran Kuwait Dhaka

Mexico city

Addis

Taipei Manila Ho Chi Minh Brisbane Perth Auckland

Luanda

2010 mega-cities Additional aviation mega-cities from 2010

Global Market Forecast

10

There are no aircraft today that can offer better fuel burn per seat and therefore eco-efficiency than the A380. The Airbus Global Market Forecast is able to project the future routes on which Very Large Aircraft (VLAs) will operate in the future. It is clear that many of these are the worlds major population centers and the places where people live, work and travel. If single-aisle aircraft are connecting people, VLAs will connect the world.

Hubs important today and tomorrow

Level of RPK from/to each city in 2029

100-250 million

125-1000 million

1-5 billion

>5 billion

ExEcutivE summary

Executive summary
The speed of the aviation industries recovery from the latest 2008/2009 financial crisis, is testament to the importance of aviation to the worlds businesses and to people in their day to day lives. Our forecast suggests that traffic will more than double in the coming 20 years as aviation becomes more accessible to those in emerging markets as well as the more traditional markets in Asia, Europe and North America. People will increasingly travel between the major population centers around the globe, developing, strengthening and

World network evolution from 2010 to 2030

Africa Middle East C.I.S.

2010

Latin America

North America

Asia / Pacific Europe

Global Market Forecast

12

C.I.S. Middle East

C.I.S.

Latin America

North America

sustaining relationships in a way that only face to face communication allows. At the same time we in the industry will seek to continue Asia / Pacific to innovate to improve the whole flying experience for pasEurope sengers, and to reduce the cost for both airlines and the environment: a goal that has been at the forefront of the industry for the last forty years, as it is today and will be in the future

C.I.S. Middle East

2030

Africa

Asia / Pacific Latin America

Europe

North America

By plotting the actual network operated in 2010 and relative to our forecast network in 2030, it is clear to see that the market will grow significantly, with Asia growing in importance over time, to become the largest single market.

ExEcutivE summary

The worlds passenger aircraft fleet (above 100 seats) will grow from 15,000 at the beginning of 2011 to just over 31,000 by 2030. At the same time, some 10,500 aircraft from the existing fleet will be replaced by more eco-efficient models. Of these, 3,400 will be recycled back into passenger service, where they too will replace older generation less eco-efficient aircraft with another airline. It is also forecast that 2,200 aircraft will be converted to freighters with the remaining 8,300 permanently retired or withdrawn from service. The Airbus forecast continues to predict that the greatest demand for passenger aircraft will come from airlines in the United States, the Peoples Republic of China and Germany, with their mix of global, low-cost and charter airlines. Europe will receive 22% of the total, with North America and Asia-Pacific taking 22% and 34% respectively. In addition, the worlds airlines will require about 5,000 smaller aircraft, either jet or turbo-prop (from 19 to 100 seats) to serve regional demand, especially in the US and Europe.

20-year demand for 26,921 aircraft worth US$ 3.2 trillion

Fleet size 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0
Recycled Stay in service 3,440 1,063

31,424 + 3.8 % per annum

Growth 16,422

15,002
Replaced 10,499

New aircraft 26,921

Beginning 2011

2030

Passenger aircraft >100 seats (excluding freighters)

Global Market Forecast

14

Globally, deliveries of single-aisle aircraft from 100 to 210 seats are the most significant in terms of volume and value, with these aircraft supplying nearly 80% of all the seats flown today and 43% of the total, calculated at sticker prices.

New passenger aircraft demand will average 1,350 per year

25,000 20,000 15,000 10,000 5,000 0 Single-aisle

% unit % value
Source: Airbus

19,165

4,518

1,907

1,331

Small twin-aisle
17% 28%

Intermediate twin-aisle
7% 15%

Very large aircraft

5% 14%

71% 43%

ExEcutivE summary

The twin-aisle segment (250-400 seats), combining small and intermediate types, is broad in terms of seating and range, but also in terms of operations which vary from domestic and regional routes (where today the A330-300 is excelling in Asia for example) to inter-continental flying, where they perform a key role connecting the large aviation mega hubs to secondary airports, a role in which the A350XWB is soon set to excel.

New aircraft demand by region

Europe
4%

CIS
17% 3%

20%

5,950

899

76%

80%

North America
15% 1%

Middle East
43% 41%

5,901

1,882

84%

16%

Latin America
16% 2%
Global Market Forecast 16

Africa
25%

2,028

1,101

3%

5,950 5,950
76% 76% 76% 80% 80% 80%

899 899

Whilst the 24% of deliveries is small compared to singleNorth America Middle East aisle delivery volumes, this segment will account for 43% of 15% 43% North America Middle East 41% Middle East deliveries North America 1% by value.
15% 15% 41% 1% Finally, Very Large Aircraft like the A380 will increasingly play a 5,901the world, primarily through key aviation key role connecting 1,882 mega hubs like London Heathrow, Dubai and Hong Kong. 5,901 1,882 5,901 Today, we already see the versatility of this class of aircraft 1,882 in moving people efficiently domestically, regionally and 16% internationally. 84%
84% 84% 16% 16%

1%

43% 43%

41%

Latin America Latin America Latin America

16% 16% 16% 2% 2% 2%

Africa Africa Africa

25% 25% 25%

2,028 2,028 2,028

82% 82% 82% 72% 72% 72%

1,101 1,101 1,101

3% 3% 3%

Asia-Pacific Asia-Pacific Asia-Pacific 9,160 9,160 9,160

31% 31% 31%7% 7% 7%

62% 62% 62%

Single-aisle Single-aisle Single-aisle

Twin-aisle Twin-aisle Twin-aisle

Very large aircraft Very large aircraft Very large aircraft

PassEngEr traFFic

Latest trafc projections

Despite two of the most difficult downturns in aviation history, both periods in which traffic growth was negative for a time, traffic in terms of revenue passenger kilometers (RPKs), has grown more than 45% since 2000. Comparing 2000 with 2010, it is clear from where much of the growth is coming, with the emerging markets of China and India more than doubling, and the Middle-East, with its airlines leveraging the benefits they have in terms of geography, wealth and global demographics, growing traffic nearly 230%.

Today's passenger traffic 46% above 2000 levels

North America +11%

Latin America +29%

Global Market Forecast

18

re-conrm growth
Even markets, that are generally considered more mature have grown, with North America and Europe growing their inter-regional passenger traffic 11% and 34% respectively.

ASK growth: 2010 vs. 2000 (Inter-regional passenger traffic)

Europe +34% Middle East +229% Africa +87%

CIS +146% China +124% Indian Subcontinent +141% Asia-Pacific +34%

Source: OAG, comparing month of September, Airbus

PassEngEr traFFic
Air travel remains a growth market
World annual traffic (RPKs - trillions) 12 10 8 6 4 2 0 1970 1980 1990 2000 2010 2020 2030
20-year world annual traffic growth 4.8%
Airbus GMF 2011

ICAO total traffic

Air traffic has doubled every 15 years

Air traffic will double in the next 15 years

TRaFFiC FOReCasT
4.8% AAGR 2010-2030 1/3 RPKs by asian carriers 5.8% aaGR growth in asia 43% total RPKs n. american & european
carriers

Middle east market share to 11%

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

Global Market Forecast

20

Asia-Pacific to lead in world traffic by 2030

Traffic by airline domicile RPK (billion) 0 Asia Pacific 2010 traffic Europe North America Middle East Latin America CIS Africa
GMF 2011 - Airbus Market Research & Forecasts

20-year % of 2030 1,000 2,000 3,000 4,000 5,000 growth world RPKs 2010-2030 traffic 5.7% 4.0% 3.3% 7.4%
20-year world annual traffic growth 4.8%

33% 23% 20% 11% 6% 4% 3%

6.1% 4.9% 5.6%

TRaFFiC FOReCasT: TOP FLOWs 1st Us Domestic 11.1% RPKs own

Still the biggest ow in 2030 Significant growth at 7.2%

2nd China Domestic 9.2% RPKs own 3rd intra W. europe 7.5% of RPKs own
Europe in 5 of the top 10 traffic ows

Airline segmentation - world traffic evolution

PassEngEr traFFic

Traffic at end 2010 4.8 trillion RPKs

5% Regional & Affiliate 15% LCC 4% Small Network 13% Major Network

4% Charter

59% Global Network

Traffic at end 2030 12.3 trillion RPKs

4% Regional & Affiliate 19% LCC 3% Charter

4% Small Network 14% Major Network 56% Global Network

Global Market Forecast

22

Largest 20 traffic ows in 2030

Traffic by airline domicile RPK (billion)
0 Domestic United States Domestic PRC Intra Western Europe United StatesWestern Europe Domestic India Middle EastWestern Europe AsiaWestern Europe South AmericaWestern Europe Asia - PRC Intra Asia PRCWestern Europe Central EuropeWestern Europe Indian SubMiddle East Domestic Brazil Domestic Asia North AfricaWestern Europe Middle EastUnited States AsiaMiddle East PRCUnited States JapanUnited States
GMF 2011 - Airbus Market Research & Forecasts

200

400

20-year % of 2030 600 800 1000 1200 1400 growth world RPKs

2.4% 7.2% 3.2% 3.9% 9.8% 5.7% 4.3% 5.1% 6.8% 6.4% 6.2% 5.7% 6.2% 6.6% 5.6% 4.6% 7.1% 5.5% 6.6% 3.8%

11.1% 9.3% 7.5% 5.4% 2.6% 2.3% 2.2% 2.2% 2.2% 2.1% 2.0% 1.9% 1.9% 1.8% 1.7% 1.4% 1.4% 1.4% 1.4% 1.4%

If world traffic is segmented by airline type, it can be seen that with 70%, Global and Major Network carriers will continue to perform most of the worlds traffic. The Low Cost model will continue to grow its share to 19% of RPKs by 2030, indicating that there is still opportunity to expand this model, particularly in Asia.

DEmanD FOr aircraFt

Single-aisle 19,000 reasons to deliver the best

The range of seating in the single-aisle segment is broad with the types segmented between 100 to 210 seats. Our forecast predicts that the centre of gravity for the category will remain at 150 seats. However, larger capacity types will see more significant volumes than smaller types, with 7,600 deliveries expected in 175 and 210 seat categories over the period. It is interesting to note that, from our analysis, 50% of deliveries will be to airlines who need deliveries across three or more single aisle segments.

Single-aisle 2011-2030 new passenger aircraft deliveries

Number of new aircraft 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 100
Source: Airbus GMF 2011

6,429

4,757 3,380 2,864 1,735

125

150

175

210 Aircraft segment

Global Market Forecast

24

single aisle eet is large Fleet to double 19,200

11,700 aircraft representing 78% of the eet globally. By 2030, forecast to stand at 73%. 23,000 aircraft, an average annual eet growth of 3.4% per annum. new aircraft deliveries

40% replacement 11,300

aircraft for growth.

50% to North American and European markets

DEmanD FOr aircraFt

Twin-aisle Broad segmentation, broad demand

Broad segment, 250-400 seats Fleet to double to 7,100 aircraft 40% demand replacement 3,800 aircraft for growth 44% deliveries to Asia 32% to N.America and Europe >12% to the Middle East
The majority of demand will be focused on the 250 and 300 seat segments with 70% or 4,500 deliveries made to airlines from these segments. The remaining 1,900 aircraft will be from the larger segments in the twin-aisle category, including aircraft up to 400 seats like the A350-1000XWB.

Global Market Forecast

26

Twin-aisle 2011-2030 new passenger aircraft deliveries

Number of new aircraft 2,500 2,362 2,000 2,156

1,500 1,206 1,000

701

500

0 250
Source: Airbus GMF 2011

300

350

400 Aircraft segment

Twin-aisle eet in service evolution

Fleet size 8,000 7,000 6,000 5,000 4,000 3.264 3,000 2,000 1,000 0
Recycled Stay in service 571 109 Replaced 2,584 Growth 3,841

7,105 + 4.0 % per annum

New aircraft 6,425

Beginning 2011

2030

Passenger aircraft 100 seats (excluding freighters) >

DEmanD FOr aircraFt

Very large aircraft Efcient Flexible

2011-2020 2021-2030 % of world deliveries 22 57 5,9%

North America

2011-2020 2021-2030 % of world deliveries 3 38 3.1%

Latin America

average size increasing 45% deliveries to Asia 19% to European airlines 23% to Middle East
airports by 2030

in VLA segment 2010 GMF vs 2011 GMF

Asia-Europe ow is a driver Geographical advantage exploited

DXB, PeK, HKG, LHR to be top VLA

Global Market Forecast

28

Optimised
New deliveries of VLA aircraft by region

2011-2020 2021-2030 % of world deliveries 134 116 18.8%

Europe

2011-2020 2021-2030 % of world deliveries 12 10 1.6%

CIS

2011-2020 2021-2030 % of world deliveries 186 116 22.7% 2011-2020 2021-2030 % of world deliveries 2.9% 27 11

Middle East

Africa

2011-2030 2021-2030 % of world deliveries 228 371 45.0%

Asia-Pacific

By 2030, 12 of the 20 largest VLA airports will be in Asia-Pacific

4 LHR 19 SFO 10 LAX 5 JFK 14 FRA 1 DXB 13 BOM 8 DEL

2 PEK 9 PVG 3 HKG

20 ICN
11 NRT

6 CDG

15 SHA 17 CAN 7 SIN 16 SYD

12 BKK 18 GRU

Source Airbus Based on number of aircraft

DEmanD FOr aircraFt

A regional overview

Asia-Pacific: to drive world demand

Latin Asia-Pacific America

7%

31%

9,160 aircraft demand US$1.3 trillion

High growth / Large developing markets Large cities / Fast developing LCCs
Latin Europe & CISAmerica

62%

19%

4%

6,849 aircraft demand US$766 billion

ropean markets kets t Sustained growth / Still untapped Central European markets Strong long haul international market / Asias largest international market
Latin America North America

77%

15%

1%

5,901 aircraft demand US$557 billion

Large replacement market / Mature domestic market c t st Still developing international market / Largest freight base
20-year new passenger aircraft demand >100 seats (excluding freighters)

84%

Global Market Forecast

30

Latin America, Middle East & Africa to represent 19% of 20-year new passenger aircraft demand
Latin America Latin America

16%

2%

2,028 aircraft demand US$197 billion

Stability and new confidence / Economies to grow further further rther Aviation resistant to downturn / Many emerging markets i k t
Latin Middle East America

82%

43%

16%

1,882 aircraft demand US$336 billion

Central to world population & wealth / 5 billion people next door on next door t do Global ambition and vision / High growth
Africa
Latin America

41%

25%

3%

1,101 aircraft demand US$126 billion

Home of the next India / Economic promise to reality o Sustaining the momentum / Intra-regional market untapped arket

72%

20-year new passenger aircraft demand >100 seats (excluding freighters)

DrivErs & challEngEs

The future: drivers and challenges

When Airbus is compiling its forecast each year, it must assess which factors are likely to drive or enable the growth and shape of our industry in the future. But equally, we must consider the risks and challenges that may hinder or change our outlook. The past is always a good place to start or as Edmund Burke stated in the 1700s "Those who don't know history are destined to repeat it".

+ Drivers
Economic growth driven by emerging economies Yield decrease (-0.4% yearly average in real terms) Deregulation in Asia, Latin America, Africa Tourism development Rise of the "emerging economies" middle classes Hubs & secondary cities with connecting and large point to point traffic LCCs in Latin America, Middle East, Africa, Asia

Global Market Forecast

32

Emerging economies expected to account for 60% and developing of the world economic growth from 2010 to 2030
Real GDP (billion US$) 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 2010 2030

Developing economies: 4% Other emerging economies: 17%

Contribution to 2010-2030 real GDP growth BRIC economies: 39% Advanced economies: 40%

2030 GDP COnTRiBUTiOn

40% 39% 60%
Advanced BRIC (Brazil, Russia, India and China) BRIC + other emerging/developing

Passenger aircraft >100 seats (excluding freighters)

Many of the fastest growing ows are to, from and between these regions and countries.

DrivErs & challEngEs

Population to drive the market

Together with GDP and yield, population is one of the key drivers of air traffic growth. The large and growing populations of the emerging markets, combined with their increasing wealth, particularly in Asia, will help to drive growth in the coming years.

2010 POPULaTiOn
15% 69% 16%
Advanced (31 countries) BRIC + Other emerging (54 countries) Developing countries

Additional countries regularly feeding air travel growth

advanced economies
31 countries 15% of world population in 2010 1 billion people in 2010

BRiC economies
4 countries 42% of world population in 2010 2.9 billion people in 2010

1970
Global Market Forecast 34

1990

Emerging countries representing 69% of world population in 2010

2010 Population (millons) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Advanced economies BRIC economies Other emerging economies Developing economies
Emerging countries

- 31 countries - 4 countries - 119 countries - 15% of world - 42% of world - 50 countries - 16% of world - 27% of world population population population population

The propensity to travel in a given country is closely linked to the GDP per capita and the wealth and disposable income of the people living there.

Source: Airbus GMF 2011

Other emerging economies

Developing economies
119 countries 16% of world population in 2010 1.1 billion people in 2010

50 countries 27% of world population in 2010 1.9 billion people in 2010

2010

2030

2050

DrivErs & challEngEs

Increasing wealth, increases

There is no doubt that as people become wealthier, their propensity to fly increases. One measure or driver is the number of middle class today and in the future in a country or region. However, the definition of middle class can vary depending

"Global middle class" expected to rise to 4.9 billion people by 2030, with 66% in Asia-Pacific
Millions of people 5,000 Sub Sahara Africa Middle East & North Africa Latin America 4,000 North America 3,249 3,000 165 251 333 2,000 1,845 105 181 1,000 338 525 664 2010 2020 1,740 Europe 0 703 2030 680 3,228 Asia-Pacific 4,884 107 234 313 322

Households with daily expenditures between $10 and $100 per person (at PPP) Source: Kharas and Gertz, Airbus.

Global Market Forecast

36

ability to fly
on which economist you talk to. But what is clear is that they will grow, particularly in the Asia-Pacific region, and by one definition will grow by more than two and a half times in number by 2030.

WORLD MiDDLe CLass in 2030

X2.5 4.9 billion 66%
growth people in Asia-Pacific

With increased economic activity, population and the increasing middle classes in developing nations, it can be expected that these countries will increasingly contribute to the growth in air traffic.

DrivErs & challEngEs

Emerging markets will grow long-haul as well as short-haul

Long-haul traffic on routes linking the emerging regions will triple over the next 20 years
20-year evolution and share of long-haul traffic for selected traffic flows (RPK), 2010 set to 100%* 500%

400%

Intra Africa/Asia-Pacific/Middle East Intra Americas TransPacific Intra Asia-Pacific Transatlantic

300% Intra Africa/ Europe-Asia Middle East/Europe Circle diameter proportional to 2030 share on total long-haul traffic 150% # of nonstop city-pairs 2030 vs 2010 200%

200%

100%

100%

neTWORK GROWTH
2x long-haul traffic growth to network growth. Highest growth between Africa, Asia-Pacific
& Middle East. China to contribute to growth in Asia, and 40% of new city pairs connecting South-East Asia, the Indian subcontinent and Australia.
Global Market Forecast 38

Long-haul traffic grew stronger than short haul traffic, despite two external shocks in the last decade
Evolution of long-haul and short-haul traffic (offered seats), base 100 in 1980 500 Short-haul traffic Long-haul traffic Long haul traffic +6% Long haul traffic +7% 2000 2010 AAGR: 3.4%

400

300

200 +3% 100

1980 1985 1990 1995 2000 2005

2000 2010 AAGR: 2.5% +8%

2010

DrivErs & challEngEs

Aviation mega-cities of networks today

Today, the vast majority of long-haul traffic flows are from, to or between a relatively small number of aviation Megacities. We have identified 39 cities through which more than 90% of the worlds traffic passes. Roughly half of this traffic connects to another destination either via a mega or secondary city.

More than 90% of the world's long-haul traffic starts, terminates or goes through an Aviation Mega-city today
Monthly long-haul traffic per type of route start/endpoint (passengers)* 12,000 10,000 8,000 6,000 4,000 2,000 0 27% 22% Passengers
Connecting traffic Nonstop traffic % on total long-haul traffic

24% 20% 3% 4% 2010 2020 2030 Aviation Megacity Aviation Megacity Secondary City <-> <-> <-> Aviation Megacity Secondary City Secondary City

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

Global Market Forecast

40

at the heart and tomorow

aViaTiOn MeGa-CiTies
39 90% 2/3 87 50:50
Aviation mega-cities in 2010 Long-haul traffic passes through them In developed markets in 2010 Aviation mega-cities in 2030 Split developed-emerging by 2030

As well as the development of the long-haul market, the short haul, either domestic or intra/inter-regional will also grow. One element in these markets that has already helped to grow traffic are the low cost airlines and their business models, which strive to maximise aircraft utilisation, and minimise costs and fares for passengers. The airlines who specialise in this model will also help to grow future air travel particularly in Asia, where the model, whilst already established, has opportunity to grow in north east Asia and China for example. With low costs enabling low fares, the growth of this model in the region will further stimulate traffic, by enabling some passengers the opportunity economically to fly before they might otherwise have been able to.

LOW COsT aiRLines

short-haul traffic share in 2010 28% short-haul traffic share in 2030 34% of all trafc in 2030 19% new demand Enable

DrivErs & challEngEs

Challenges also to shape the

It is well understood that the aviation industry is cyclical, with economic cycles, and occasional exogenous shocks impacting demand. At these times, the perception of people and businesses as much as the actual impact of these events, can be as detrimental. Equally, as the economic cycle moves into a more positive phase, so too does the aviation industry. However, other factors can and do influence the industry which must be considered. Environmental considerations had a broad impact in the past, with legislation on noise, supported by the industry, in the late 1990s leading to changes to the fleet, at a cost to airlines for example. These have reduced the impact on the neighborhoods that grow up around many airports, often as a result of the opportunities that proliferate near them. Today, and in the future, environmental legislation will shape the industry. As in the past the industry will invest in technologies and adapt their models to meet these challenges. However, with the slim margins and significant economic and social benefits of aviation these actions should be measured and global.
WTI oil price (US$ per bbl) 140 120 100 80 60 40 20 0
1980 1990 2000 2010 2020 2030

History Oil price (Cst 2010 US$) Oil price (Current US$)

Forecast

Global Market Forecast

42

industry.
Fuel is another factor that will shape the future as the industry continues the challenge to reduce fuel burn per seat from an environmental and operating cost perspective. Whilst long-term forecasts suggest that oil prices will range something between $90 and $100 in the coming years, it is expected that there will be occasional spikes driven by such things as demand, supply and US dollar value. As part of our forecast process, Airbus adjusts the econometric forecasts it uses for traffic forecasting to an oil price scenario with its subsequent impact on future economic growth. Today, manufacturers and airlines are seriously investigating alternative drop in fuels to help mitigate the challenges fuel brings in terms of costs, availability and environmental impact.
Moving from Demonstration flights to Value Chain Projects
Feedstock growth Feedstock selection Biofuel burn Biofuel uplift

Value chain

Feedstock crop

Feedstock transportation

Feedstock conversion into Biofuel

Biofuel transportation to Airport

Alternatives to air travel also need to be considered in aircraft demand forecasts. The high speed train has for a number of years been developed, in many cases with public finances, and has in some cases acted as substitute for air travel and at times as a complement. However, air transport will continue to demonstrate its benefits in providing mass transportation that is efficient and cost effective compared to other modes, particularly for developing markets.

New passenger aircraft deliveries by region

summary rEsults

Africa 50-seats 70/85-seats 100-seats 125/210 seats Small twin-aisle Intermediate twin-aisle VLA TOTAL 207 273 108 682 214 59 38 1,581

Asia Pacic 313 925 266 5,451 1,933 911 599 10,398

CIS 48 284 102 627 128 20 22 1,231

Passenger eet development

Fleet 2010 New Aircraft deliveries 2011-2020 642 1,619 996 8,246 2,318 787 508 15,116 New Aircraft deliveries 2021-2030 843 1,843 739 9,184 2,200 1,120 823 16,752

50-seats 70/85-seats 100-seats 125/210 seats Small twin-aisle Intermediate twin-aisle VLA TOTAL

4,917 1,557 1,455 10,232 2,348 916 51 21,476

Global Market Forecast

44

Europe 224 583 406 4,123 807 364 250 6,757

Latin America & Caribbean 169 311 278 1,375 281 53 41 2,508

Middle East 21 70 72 707 523 278 302 1,973

North America 503 1,016 503 4,465 632 222 79 7,420

TOTAL 1,485 3,462 1,735 17,430 4,518 1,907 1,331 31,868

New Aircraft deliveries 2011-2030 1,485 3,462 1,735 17,430 4,518 1,907 1,331 31,868

Recycled

Remaining in service with same operator 101 172 130 818 57 52 6 1,336

Fleet 2030

828 344 147 2,715 455 116 7 4,612

2,414 3,978 2,012 20,963 5,030 2,075 1,344 37,816

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