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Commercial Aviation: Asia PacificCommercial Aviation: Asia Pacific Fleet & MRO Forecast MRO Asia...
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Commercial Aviation: Asia PacificFleet & MRO Forecast
MRO AsiaSeptember 2020
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Intelligence & Data Services | Aviation Week Network
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Information Classification: General
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Asia Pacific Europe Middle East United States World
Global Economy
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Global Financial Crisis COVID-19
The economic downturn caused by COVID-19 will be significantly worse than after the 2008 financial crisis
Unlike after the global financial crisis, GDP is expected to contract in all global regions.
Source: IMF
• Downturn is projected to be significantly worse than the one which followed the Global Financial Crisis
• Global GDP is expected to contract by between 4-6% in 2020
• Extent of the economic impact varies by region but all will see GDP fall.
Information Classification: General
Utilization – The beginnings of a recovery?
Note: Day-on-day % change, 7-day average utilization rate through end of August
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Seven day average of growth in flight hours suggests Chinese, European and US utilization has made steady gains since late April but recovery remains tentative
Rate of decline in US and European utilization reached
its peak in late March
US and European utilization has seen a steady recovery
since late April.
Chinese utilization saw a recovery in mid-to-late February but has
plateaued since that time
Large increase in European utilization in early July driven
by LCCs.
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Source: Flight Tracking Data, Aviation Week Intelligence Network, Copyright 2020
Information Classification: General
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2015 2016 2017 2018 20192020 (f)2021 2021 2021 2021 2021 2021 2021 2021 2021 2021
Aircraft
Forecast2.4% CAGR 2021-30
2.9% CAGR 2015-19
Aviation Week Network Forecast
In-Service Fleet - Analysis
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Annual count of active commercial aircraft, historical & forecasted
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Fleet Discovery, Aviation Week Network, Copyright 2020.
• 2.4% CAGR expected after 2.9% historical fleet growth.
• In-service fleet in 2020 is expected to fall to 27,370 aircraft – below 2015 levels - losing 3,200 aircraft vs. 2019.
• Narrowbodies are key growth driver over decade.
Fleet increases from 27,370 in 2020 to
38,300 in 2030
Information Classification: General
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Aircraft Retirements - Analysis
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Annual retirements historical & forecasted
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Fleet Discovery, Aviation Week Network, Copyright 2020.
2015-20 Average = 668
Forecast2021-30 Average = 917
• Retirements peak in 2020 at 719.
• Retirement projections continue to increase peaking at 1,122 in year 2028.
• Historic high percentage of fleet rates dominate the decade.
• Used spare parts/green time engines will flood markets for popular legacy types depressing pricing.
• ~2,060 737s, ~1,951 A320s retiring in next 10-years.
~9,400 retirements over 10-years
Aviation Week Network Forecast
Information Classification: General
New Deliveries - Analysis
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Annual deliveries historical & forecasted
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
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• 16,200 new deliveries over 10-years.
• Deliveries 30% lower than previous expectations.
• Narrowbodies lead recovery efforts, 71% share.
Narrowbody71%
Widebody16%
Regional Jet7%
Turboprop6%
2021-30 Share of Deliveries
Aviation Week Network Forecast
Information Classification: General
Most valuable programmes, 2021-2030 – by family
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A330ERJ170/190
A220
767
747
ATRA380
C919
DHC-8
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MRO Demand (billions)
$2 trillion worth of aircraft to be delivered over the next decade with $1 trillion spent on MRO
Boeing 737Retail value: $563 billionMRO demand: $203 billion
Airbus A320Retail value: $613 billionMRO demand: $259 billion
Airbus A350Retail value: $267 billionMRO demand: $47 billion Boeing 787
Retail value: $267 billionMRO demand: $88 billion
Boeing 777Retail value: $140 billionMRO demand: $129 billion
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
-$10.0
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Engine Maintenance $30.2 $35.6 $36.7 $41.7 $39.7 $43.9 $43.3 $43.5 $43.3 $46.5
Line Maintenance $16.3 $17.3 $18.0 $18.2 $18.4 $18.6 $18.8 $18.9 $19.0 $19.2
Components $13.8 $15.5 $16.8 $17.5 $17.8 $18.2 $18.6 $18.7 $19.2 $19.5
Modifications $5.2 $5.6 $6.1 $6.4 $6.9 $6.8 $6.6 $6.6 $6.5 $6.4
Airframe Heavy $5.6 $4.9 $4.5 $5.5 $5.3 $4.3 $5.6 $5.0 $4.7 $6.4
Pre-Covid Forecast $87.3 $87.9 $93.6 $92.7 $95.1 $97.3 $99.3 $100.3 $106.8
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MRO Demand - Analysis
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MRO aftermarket and the impacts from the pandemic
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Pre-COVID-19 Forecast
MRO Demand CAGR 2021-30:3.6%
Pre-COVID vs, COVIDMRO Demand 14% lower,
$36.6 billion across 2021-23
• MRO grows at 3.6% CAGR 2021-30, worth $878 billion.
• Engine MRO demand is $405 billion over decade and grows the fastest at 4.9% CAGR.
• Component demand grows at 3.9% CAGR, $175 billion demand.
Total MRO Demand
Line Maintenance
Modifications
Airframe Heavy
Components
Engine Mainenance
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Information Classification: General
Engines
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In-service fleet trends by engine size category
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
• Engine fleet claws back at 2.2% CAGR.
• The key driver of growth, narrowbody engines, grows at 3.8% CAGR.
• Narrowbody engines comprise a 61% fleet share by 2030.
• LEAP surpasses CFM56 by 2029. -
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Turboprop Regional Jet Widebody Narrowbody
Engine Fleet increases from 65,260 in 2020 to
79,250 in 2030
2.2% CAGR Forecast2021-30
Information Classification: General
Engine MRO
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MRO service events (overhauls vs. LLPs), demand and trends
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
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ATA 72 Engine Overhauls ATA 72 Engine LLP ATA 72T Engine Overhauls - Turbo ATA 72T Engine LLP - Turbo
116,000 Engine Service Events3.9% Event CAGR 2021-30
• Demand grows at above average 4.9% CAGR.
• $405B in demand is expected.
• Engine MRO comprises 46% of all MRO demand.
• Nearly 116,000 engine service events needed over the decade.
• Turbofan LLP events grow at 5.6% CAGR.
$405 billion in $ Demand4.9% Dollar Demand CAGR
Total MRO Events
ATA 72T Engine LLP
ATA 72T Engine Shop Visit
ATA 72 Engine LLP
ATA 72 Engine Shop Visit
4%
15%
19%63%
Information Classification: General
Heavy Airframe Demand
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Heavy airframe maintenance demand will be driven by the timing of checks when aircraft return to service.
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
• $52 billion will be spent on heavy airframe maintenance by operators over the next decade.
• Around 46% of demand relates to maintenance on the Airbus A320 Boeing 737.
• COVID-19 groundings have created a bow-wave of calendar checks which will drive short term demand.
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747 A330/340 787
767 ERJ170/175/190/195 A350
A380
Information Classification: General
Storage
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Aircraft Returning from long-term storage post-pandemic
Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
• Around half of the aircraft stored in the early stages of the pandemic are expected to return to service by 2023.
• Through the first three years of the forecast, a total of over 2,200 aircraft are expected to return from storage.
• Over half of the aircraft returning from storage in the forecast period will return by the end of 2021.
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Single Aisle Twin Aisle Regional Turbofan Turboprop
Long range widebody fleet will see the slowest return to service with aircraft gradually leaving storage over the next five years.
Information Classification: General
Asia-Pacific 2021-2030:Regional MRO Marketcompared to Global Market
13Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
24% in APAC
27% in APAC
28% in APAC
24% in APAC 26% in
APAC
APAC ISF growth x 2
APAC MRO growth x 1.5
Information Classification: General
Asia-Pacific 2021-2030:Fleet and MRO Demand: Regional Markets
14Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific 2021-2030:Fleet Forecast
15Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific 2021-2030:MRO Events
16Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific 2021-2030:China Fleet Forecast
17Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific 2021-2030:China MRO Forecast
18Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific 2021-2030:Vietnam Fleet Forecast
19Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
20Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Asia-Pacific 2021-2030:Vietnam MRO Forecast
Information Classification: General
Asia-Pacific 2021-2030:South Korea Fleet Forecast
21Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific 2021-2030:South Korea MRO Forecast
22Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
Information Classification: General
Asia-Pacific MRO:Key Observations
23Source: 2021 Commercial Aviation Fleet & MRO Forecast, Aviation Week Network, Copyright 2020.
• Heavy maintenance revenues falling faster than projected
• Drop in demand as technology improves
• Bustling marketplace, lower labour costs and service charges from cheaper market entrants mean that quality and innovation are critical
• Workload balance changing….but will the new revenue blend last?
Commercial AviationFleet & MRO Forecast
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Intelligence & Data Services | Aviation Week Network