Boeing (BA) Sees Indian Plane Traffic Market with Highest Passenger Growth

Boeing (NYSE:BA) said it sees India being the fastest growing market for airline passenger traffic growth over the next two decades, as measured by percentages, outgrowing even China in that regard.

Including all of South Asia, which entails India, Boeing estimates growth to be at an 8.4 percent annual clip. China is expected to grow at a rate of 7 percent during the next 20 years.

As for the number of aircraft expected to be acquired by India, Boeing sees them needing about 1,450 new planes to serve the growing market by 2031. That could generate $175 billion in sales.

Even though time frames are difficult to project into, as the Indian air traffic market has shown over the last year, where it dropped by 1.1 percent in July from 2011, in general these numbers should hold pretty well, although it's certainly possible a couple of years could be slashed or added as to when the planes will be acquired.

Other questions have also arisen over the competitiveness and management of Indian airlines, as strong competition has resulted in prices being slashed, which has led to low margins. Also a factor is the rising cost of jet fuel and the outrageous taxes imposed by the government of India.

India's other major problem is its anti-business stance which makes it extremely difficult for companies to successfully do business with the country.

Boeing has yet to deliver the first of its 27 Dreamliners ordered by Air India, which is owned by the government, as an ongoing dispute over compensation Boeing should pay from production delays which resulted in the delivery schedule being altered weighs on the deal.

Also of note is makers of planes have been battling fiercely for market share, which has resulted in them cutting prices up to 50 percent for some plane models in order to win business.

Airbus recently won a major $7 billion deal from Philippine Airlines Inc, leaving Boeing with nothing to show for intense lobbying by the United States on behalf of the company.

China to Build 45 New Airports on Travel Demand

China plans to build at least 45 new airports in the next five years to serve booming travel, the top industry regulator said Thursday.

The plans call for spending 1.5 trillion yuan ($230 billion) to expand air travel, said Li Jiaxiang, administrator of the Civil Aviation Administration of China.

Some 130 of China's 175 existing airports lost money last year but Beijing will support them to boost local economic growth, Li said at a news conference.

He said incomes in farming areas have risen when airports open nearby, allowing their fruit and vegetables to be flown to more prosperous major cities.

China's fast-growing air travel market is expected to pass North America as the world's biggest in coming decades.






Full Story

Baidu (Nasdaq:BIDU) Beats Estimates as Google (NYSE:GOOG) Falters

In a censorship battle that Google (NYSE:GOOG) lost to China, Baidu (Nasdaq:BIDU) took advantage of the misguided actions of Google to seize even more share in China and revenue growth to go with it.

Baidu Chief Executive Officer Robin Li said, “We have been gaining traffic share gradually.”

Guidance from Baidu were for revenue in the third quarter to increase 77 percent to $333 million, as it increased customers over the last three months in record numbers.

Earnings for the quarter ending June 30 increased to 837.4 million yuan, or 2.40 yuan for each American depositary receipt. That was up from 383.3 million yuan, or 1.10 yuan for each ADR receipt during the same quarter last year. Analysts had been looking for 710.4 million yuan on average.

Revenue for the quarter stood at 1.9 billion yuan, a big increase over the 1.1 billion yuan in the second quarter of 2009.

Li says the company has over 250,000 customers now, adding 33,000 more in the latest quarter.