By Brian Prentice and Anthony DiNota
Brian is the spouse of Oliver Wyman’s Transportation & Services practice, specializing in operations consulting and strategy. Anthony is senior vice president and general manager of Oliver Wyman’s CAVOK Division, which provides technical consulting to the global aviation, aerospace, and rail industries. the leading authors of the global fleet market and MRO forecast 2024-2034.
The global fleet of advertising aircraft will reach record levels again in 2024, the first year of true growth since its peak just before the start of the Covid-19 pandemic. But despite growing demand for air travel, a push back toward profitability and more new, fuel-efficient planes, the fleet will grow more slowly than before the pandemic.
Between 2024 and 2034, our latest Global Fleet and MRO Forecast predicts that the number of advertising aircraft internationally will grow at a compound annual expansion rate (CAGR) of 2. 5%, reaching more than 36,400 aircraft through early 2034. This represents 28% of the existing fleet of approximately 28,400 aircraft.
Despite a decent expansion, it is well below the 39,000 aircraft we predicted through 2030 in the most recent forecasts published through Oliver Wyman in February 2020 at the time of the Covid outbreak. We don’t expect the global fleet to succeed in that duration until 2036. necessarily a loss for the industry of six years of expansion due to Covid.
The CAGR of the new forecast is also lower than the 2. 9% forecast by Oliver Wyman last year for 2023 through 2033. This year’s CAGR has been tempered by the modest global economic expansion that peak interest rates, thanks to central bankers around the world, have made inevitable. and through production delays.
Meanwhile, the global maintenance, repair and overhaul (MRO) market will also start breaking records again. Spending in 2024 is expected to reach $104 billion. In real terms, this is 1% more than the pre-Covid peak set in early 2020. By 2034, Oliver Wyman’s latest global forecast predicts that MRO requests will reach $124 billion, rising from 1. 8% in 10 years to 2. 9%. forecast through our 2023-2033 forecast.
The location of the fleet will also be changed in the next 10 years. By 2034, China will become the world’s second-largest fleet, displacing Western Europe as the third-largest fleet. The most sensible fleet honors of the decade will pass to North America, where the fleet now numbers 8,200 people. This number will increase to 9,850 by 2034.
China has about 4,100 aircraft and is expected to have just over 6,400. This means that China’s fleet will be 65% larger than North America’s by 2034, up from 50% in 2024. Despite China’s expansion of 56% in 10 years, this fleet will grow. at the fastest pace. It has been hampered by China’s slowing economy, which is facing an implosion in asset values and an aging population.
Currently, with just over six hundred aircraft, India’s fleet leads the forecasts in terms of growth, with aircraft expanding at a rate of just 13% in the first five years and just around 10% during the 10-year forecast period. By 2034, it will be 2. 5 times larger than it is today. To give an idea of how fast its expansion is going, India has more than 1,800 aircraft on order, more than triple its current size.
The other expanding fleet is in Eastern Europe, with growth of 9. 2% in the first five years and 7% in the ten years. This is despite the inclusion of Russia in the regional figures. The Russian fleet is expected to be the only primary fleet. Its fleet will see a contraction between 2024 and 2034. Se will shrink by 8% over the forecast period and, due to industrial sanctions imposed following the invasion of Ukraine in 2022, its narrowbody fleet will be reduced by 44%.
A new competitor could also enter the global aerospace market. This year, China unveiled two new aircraft — the narrow-body C919 and the ARJ21, a regional jet — at the Singapore Airshow, hoping to start delivering them globally in the 2030s. Although the manufacturer, Commercial Aircraft Corporation of China Ltd. (COMAC), has lately limited production capacity, Chinese airlines have placed orders for 1,000 C919s.
Four C919s have been in service since the beginning of the year and fly for Chinese airlines. But despite the optimism behind the 1,000-aircraft portfolio, we expect COMAC to deliver only about six hundred until 2033. The need for COMAC to increase production increases means that it is unlikely to be anything significant in the global aerospace market in this forecast period. None of the COMAC styles have been approved by the U. S. Federal Aviation Administration. The U. S. Air Force Administration (FAA) and the European Union Aviation Safety Agency (EASA).
After three years of Covid, inflation, stark curtains, and labor shortages, the aerospace industry is left with a shortage of professional labor and a pressing need to modernize and optimize production at all levels of the origin chain. The retirement of many baby boomers could also contribute to some of the quality control issues plaguing the industry.
The MRO support network that helps keep planes flying faces similar challenges. For example, there is a critical shortage of aircraft maintenance technicians and engineers, making it increasingly difficult for the industry to keep up with aircraft manufacturers’ schedules and airlines’ needs. In North America, the gap between origin and demand for AMT is expected to reach 24,000 by 2026, according to a study by OIiver Wyman.
But as the fleet and usage of those aircraft grows more slowly, so does the MRO. Engine maintenance appears to be the exception, with a 10-year CAGR of 2. 3% over the forecast period. This is due to the arrival of a traditionally unprecedented program. number of next-generation engines on the market, as airlines seek to save money by powering fuel and reducing greenhouse fuel emissions.
However, the expected benefits of increased reliability and operating prices from new engines are fully learned due to the operational disruptions faced by new engines. From CFM International’s LEAP to Pratt’s GTF
A large number of new engines put enormous pressure on aerospace production and the aircraft aftermarket. One of the highest-profile conditions was Pratt’s turbofan (GTF) platform.
While the GTF is already facing sustainability issues, last summer it discovered that infected steel dust was being used in the manufacture of some of the engine’s internals. This meant that those parts would have to be replaced faster than expected. As a result, the FAA and EASA ordered the inspection of 1,200 GTF engines, out of the 2,500 in service, grounding many aircraft at once. By the end of February, between 250 and 300 planes were parked awaiting engine inspections.
At a time when the aerospace industry is being driven to meet the growing demand for air travel, engine quality issues and delays are potential impediments to a significant increase in overall aircraft production and deliveries.