Regional aircraft market worth US$130 billion over next decade

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The global market for regional transport aircraft over the next decade is worth US$130 billion, according to a new Forecast International report, and will account for 4 198 jet and turboprop powered aircraft, with jets making up 60% of the total.

Forecast International’s ‘The Market for Regional Transport Aircraft,’ study indicates that Bombardier, Embraer, and ATR will be the leaders among regional aircraft manufacturers during the 2011-2020 period.

Bombardier, with a product line that includes jets and turboprops, is expected to build 1,278 regional aircraft during the timeframe, representing a 30.4% share of the market.

Embraer specializes in jets, and the study predicts that the Brazilian company will produce 992 regional jets for a 23.6% market share. Turboprop manufacturer ATR is expected to build 668 aircraft, representing a 15.9% share.

According to the new Forecast International study, the regional aircraft market is entering a period of transition and transformation. The regional airline industry is consolidating as large holding companies gain control of multiple carriers. This is especially true in the large U.S. market, where companies such as Pinnacle, Republic, and SkyWest each control a number of airline brands.

According to Forecast International senior aerospace analyst Raymond Jaworowski, “The size of the large regional powerhouses affords better economies of scale, more diverse teaming arrangements (and increased negotiating leverage) with the major airlines, and, potentially, greater revenue streams.”

Meanwhile, opportunities for growth in the regional airline sector will be somewhat limited, especially in mature air travel markets such as the U.S. and Europe. The majors themselves are consolidating, and regional carriers will be competing for a shrinking number of opportunities to provide hub feeder service to the majors’ networks.

One way for regional carriers to grow revenue in the years ahead will be to fly larger aircraft. In the U.S. in particular, though, scope clauses generally prevent regional carriers partnered with major airlines from flying jets larger than 70 or 76 seats. Nevertheless, other regionals, low-fare carriers, and even major airlines can be expected to acquire 90-125 seat regional aircraft in quantity.

Meanwhile, in September Airbus predicted that global airlines will buy US$3.5 trillion of aircraft over the next 20 years to meet relentless demand for travel to and from Asia’s burgeoning “megacities” and renew ageing fleets in the West.

The world’s largest civil jetmaker raised its forecast for airplane deliveries over the next 20 years by around 8 percent to 27 800 aircraft, as part of an annual market survey.

That figure includes 900 freighters to keep up with a projected expansion in global trade.

Revenue passenger kilometres — the number of people boarding planes adjusted for the distance flown — will grow by an average 4.8 percent per year, which is equivalent to traffic more than doubling in the next 20 years, Airbus said.



Boeing is even more optimistic, with a recent June forecast of 5.1 percent a year.