Recession creating aircraft oversupply

13 September 2009

Switzerland-based investment bank, UBS has predicted that there will be a surplus of 1,400 aircraft by the end of this year. It said the upshot will be production cuts at both Airbus and Boeing, according to website FlightGlobal. It would mean Airbus production rates could fall by about 40% by 2012 and in order to avoid the cuts, passenger traffic would have to grow at an estimated rate of 14%, far higher than the expected growth of 5%, UBS said. Plane lessor AWAS believes the surplus will be about 1,000 aircraft by the end of this year, rising to 1,600 by the end of 2010.

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