Subscribe Free
in Air Transport

Oliver Wyman sees expansion ahead for aviation industry despite challenges

Posted 17 February 2020 · Add Comment

The next decade will be more challenging for the aviation industry than the 10 years previous years, despite prospects for rising passenger demand, according to Oliver Wyman’s annual Global Fleet & MRO Forecast.

 

By the beginning of 2030, the global fleet is expected to grow to over 39,000 aircraft, a compound annual growth rate of 3.4 percent annually. This despite looming challenges such as slower economic expansion, increased congestion in the air and at airports, trade-related issues, and pressure on the industry to more actively address climate change. The fleet growth will also fuel increased demand for maintenance, repair and overhaul (MRO) services.

 

In the short-term, the industry is also facing potential impacts from the rapidly spreading coronavirus as well as the grounding of the 737 MAX.  While in last year’s report, we expected 1,400 737 MAX aircraft to be in service around the world by 2020, the 2019 grounding and subsequent production halt will reduce that number to somewhere between 150 and 700 depending on when the aircraft passes re-certification requirements, is cleared for service, and pilots are trained on any new updates. 

 

“Even with these challenges, along with some expected slowing in the growth rate of passenger demand as well as changes in the mix of traditional freight and ecommerce freight, the industry should still see solid fleet growth in both passenger and freighter aircraft over the next 10 years,” said Tom Cooper, Oliver Wyman vice present and lead author of the report.

 

Manufacturers will produce over 21,000 aircraft, at an annual average of 2,100, which is more than 30 percent above production for the previous decade, and demand for MRO is expected to expand by 3.7 percent compounded annual growth rate over the next 10 years.

 

“In terms of aircraft class, narrowbodies will see the most growth at well over 5 percent which is more than any other class,” Cooper added. “Additionally, the engine category will continue to be the primary driver of overall MRO market growth.”

 

Key findings include:

 

In-service fleet forecast:

Globally, the fleet will grow at an average of 3.4 percent annually, with Asia driving most of the growth. China’s fleet is expected to double in size by 2030.

The global fleet is relatively older than ever before. Currently, there are 2.5 times more aircraft over the age of 25 in use than in 2010.  In the next decade, there will be an increase in retirements compared to the previous 10. The 737 MAX and A320neo will represent most of the new aircraft deliveries, despite the current issues facing the MAX.

 

MRO forecast:

The global aging fleet will have a positive effect on MRO demand – pushing it to $130 billion in 2030 from $90 billion in 2020, an average annual growth of 3.7 percent. Engine MRO is the largest and fastest growing segment.

MRO demand will continue to be concentrated in the top 10 types of aircraft (85%), but by 2030 the A320neo and 737MAX will represent two of the four largest platforms by MRO demand

The impact of the 737 MAX grounding and corresponding production pause will have effects on MRO demand and will be first seen two to three years down the line when the first round of heavy maintenance is due.

 

Forecast scenarios:

A significant number of factors are contributing to a riskier outlook for Europe, including; concerns about climate change, Brexit, and financial troubles of some airlines.

The 737 MAX challenges have had a significant impact on the in-service fleet forecast. By the beginning of 2022, there will be between 30 and 45 percent fewer MAXs in operation than expected at the start of last year.

 

* required field

Post a comment

Other Stories
Advertisement
Latest News

Air France KLM group wins Sustainability Award at Dubai Airports Excellence Awards

Air France KLM group was the winner of the Sustainability award for 2018 at the third annual Dubai Airports Excellence Awards held at Soho Beach Meydan, on 22 April 2019.

MBRSC releases GIF image showing decline of NO2 in the GCC

Mohammed Bin Rashid Space Centre (MBRSC) has released a GIF image of the decrease in nitrogen dioxide (NO2) concentration in the GCC countries, between 26 November 2019 until 27 March 2020.

Emirates to be bailed out by the Dubai Government

The Dubai Government is set to bail out Emirates Airline after its financial impact of the Covid19 pandemic.

OneWeb files for Chapter 11 restructuring to execute sale process

OneWeb, a communications company, announced today that the company and certain of its controlled affiliates have voluntarily filed for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern

Pillar Hawk

Locally-assembled BAE Hawks have become the first new Saudi-built fast jet aircraft to fly in home skies, marking a significant step forward for the kingdom’s aerospace industry. Jon Lake reports.

ALSIM unveils new AL40 flight training device

ALSIM, a flight simulator manufacturer headquartered in France, has launched its new AL40, an exact replica of a new Diamond DA40 NG.

GALF SK2702240620
See us at
AVMENA20 BT1309100620Arabian Trav Mark BT1603010720SaudiAirshow21BT2011180221MAPS2020 BT1102171120