Business

October 9, 2013

Forecast International predicts restrained growth in regional aircraft market

In Forecast International’s new study, “The Market for Regional Transport Aircraft,” the Connecticut-based market research firm predicts that 4,035 regional aircraft will be built from 2013 through 2022.

The value of this production, which includes both regional jets and regional turboprop airliners, is estimated at $141.8 billion in 2013 U.S. dollars.

In the new study, Forecast International projects that annual regional aircraft production will experience gradual, though steady, growth between 2013 and 2020.  The company expects 371 regional aircraft to be produced in 2013, with annual output rising to a peak of 486 aircraft in 2020.  A cyclical downturn is anticipated for 2021 and 2022, the final two years of the forecast period.

Increasing market demand for regional aircraft is being fueled by a number of factors, including rising air traffic on regional routes and a need for regional carriers to replace economically inefficient aircraft.  However, the Forecast International study points out that certain restraining factors exist that will place some limits on growth in the market.  For instance, the ongoing consolidation of major airlines has led to fewer opportunities for feeder work for regional carriers.  Too many regional airlines are chasing too few opportunities.

Other factors that will hamper market growth include increasing government regulation and the maturation of the U.S. and European air travel markets.  In addition, perhaps the most critical factor limiting market growth is the continuing existence of scope clauses in major airline pilot contracts, which restrict the size and number of aircraft that regional partners of major carriers can operate.  The maximum capacity permitted in most scope clauses in the U.S. market is 76 seats.

The existence of such scope clauses limits the overall growth that can be achieved in sales of regional jets seating 90 passengers or more.  Forecast International senior aerospace analyst Raymond Jaworowski said, “Scope clauses constitute an artificial barrier to natural growth in the regional jet market.  Demand in the market is already trending toward larger-capacity aircraft and, in the absence of scope clause limitations, this trend would strengthen and accelerate.”

Forecast International predicts that the leading regional aircraft manufacturers during the 2013-2022 timeframe will be Bombardier, Embraer, and ATR.  Bombardier is expected to lead the market in the number of aircraft produced, while Embraer is forecast to lead in the monetary value of production.  Bombardier is expected to produce 1,035 regional aircraft, worth $47.7 billion, during the forecast period.  Embraer is projected to build 1,018 regional aircraft, worth $49.5 billion.  ATR is expected to be third in both categories with production of 668 aircraft, worth $15.4 billion.

A number of new entrants are looking to challenge Bombardier and Embraer at the upper end of the regional jet market.  These new players include COMAC of China, Mitsubishi of Japan, and Sukhoi of Russia.




All of this week's top headlines to your email every Friday.


 
 

 

Headlines October 20, 2014

News: Navy grounds ‘Top Guns’ - The F/A-18s needs spare parts and in too many cases they’re being taken from brand new jets. This is a risk to national security and pilots’ lives.   Business: Boeing seeks revised schedule for U.S. aerial tanker - Boeing is revising its master schedule for developing the new U.S. Air Force...
 
 

News Briefs October 20, 2014

New military medical team to help with Ebola in U.S. Defense Secretary Chuck Hagel has ordered the military to prepare and train a 30-member medical support team that could provide short-term help to civilian health professionals if there are more Ebola cases in the United States. His spokesman, Rear Adm. John Kirby, says the team...
 
 

Dragon ‘fires up’ for flight

The Air Force and NATO are undergoing a cooperative development effort to upgrade the avionics and cockpit displays of AWACS aircraft belonging to the 552nd Air Control Wing at Tinker Air Force Base, Okla., and the NATO E-3 Sentrys from Geilenkirchen, Germany. The Diminishing Manufacturing Sources Replacement of Avionics for Global Operations and Navigation, otherwise...
 

 
Boeing photographs

Boeing-built X-37B successfully completes third flight

Unmanned spacecraft concludes record-setting 674-day mission   Boeing photograph A third mission of the Boeing-built X-37B Orbital Test Vehicle was completed on Oct. 17, 2014, when it landed and was recovered at Vandenberg...
 
 

Boeing concludes commercial crew space act agreement for CST-100/Atlas V

Boeing has successfully completed the final milestone of its Commercial Crew Integrated Capability Space Act Agreement with NASA. The work and testing completed under the agreement resulted in significant maturation of Boeing’s crew transportation system, including the CST-100 spacecraft and Atlas V rocket. NASA in July approved the Critical Design Review Board milestone for Boeing’...
 
 

AF to release small business research solicitations

The Air Force Small Business Innovation Research and Small Business Technology Transfer program office is set to release its fiscal year 2015 list of topics Oct. 22, on the SBIR/STTR website.  Small businesses and research institutions with expertise to address the topics’ technology challenges are encouraged to submit proposals. During 2014, the Defense Department SBIR...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>