The aerospace and defense markets offer attractive growth perspectives

While some sectors of the global economy have been struggling to catch their breath since 2008, the aeronautics sector is doing better than ever. Deloitte points to this by citing a 2016 growth rate of 1.7% for the global aerospace industry. All of the sector’s economic indicators are in the green right now! Europe has showaed a complete, dynamic and rapidly growing aeronautical sector as well. Should you wish to have further information on the subject of developing a business in the European aeronautics sector, please visit www.absoluzconsulting.com.

Global growth

Air traffic, one of the main engines of the global aviation industry continues in 2016 its growth began in the 80s. 3.5 billion passengers were transported that same year, against 2 billion 10 years earlier. Low-cost airlines are increasing their contribution in this figure with 28% of the passengers transported worldwide last year. Overall, carriers are profitable because the increase in traffic is associated with passenger revenue growth of 6.2 times over 35 years. Studies conducted by Deloitte predict 10 billion passengers carried in 2036. Second driving force of the global aviation industry: aircraft deliveries. An increase in the number of travelers necessarily implies increased capacity and therefore the increase in production rates. As a result, 1360 commercial aircraft were delivered in 2016 and forecasts predict 35,000 aircraft to be delivered by 2035.

The airports overload as a major issue

If air traffic is constantly growing, it is clear that airports are the first to be impacted. Passenger flows in platforms all over the world are growing, a new issue appears: how to absorb them? As for Europe, building a new airport has become almost insurmountable and those that exist must come up against anti-noise policies that limit their possibilities of extension. To this problem is added that of the management of ever denser air traffic. The authorities are already considering a future where air traffic control will leave room for automation of resources: a boon for companies investing in the design of artificial intelligence.

The MRO market: a gold case

With approximately 28,000 airliners in service worldwide in 2016, the maintenance market (including repair and major overhauls) is experiencing significant growth. Very good opportunities will emerge in the coming years with the aging of fleets and aircraft deliveries on the rise. If the biggest companies in the sector such as Air France Industrie or Lufthansa Technik consolidate their reference position, foreign competition and the arrival of new entrants could change the distribution of market shares in the coming years. In the absence of aircraft production industries, some countries may even specialize in maintenance services.

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