Aerospace Industry Forecast
As part of its customer base, the forging industry boasts many dynamic markets, including automotive, aerospace, energy exploration and production, power generation and others. The aerospace industry is a major consumer of our industry’s output, and that industry looks to ours to supply a wide range of quality mission-critical and commodity components alike.
Recently, the world’s two largest suppliers of aircraft for passenger and freight applications – Boeing and Airbus – released their individual 20-year projections on demand for aircraft. Since these forecasts tie in directly to projected demand for certain forged components, a summary view of these reports is appropriate.
To begin, a recognition of the market forces that drive passenger and freight miles, and consequently new aircraft demand, is in order. Both companies are in reasonable agreement that the cost of fuel, global and regional economic conditions, aircraft range and load capabilities, infrastructural facilities, environmental regulations, aircraft efficiency, competing transportation modes and other factors are key drivers for the aviation industry.
Factoring these market drivers into its forecasting model, Boeing predicts long-term demand for 36,770 new airplanes, valued at $5.2 trillion. The Boeing report continues to “... project that 15,500 of these airplanes (42% of all new deliveries) will replace older, less-efficient airplanes. The remaining 21,270 airplanes will be for fleet growth, which stimulates expansion in emerging markets and development of innovative airline business models. Single-aisle airplanes continue to command the largest share of the market. Approximately 25,680 new single-aisle airplanes will be needed over the next 20 years. Fast-growing, low-cost carriers and network carriers pressed to replace aging airplanes drive single-aisle demand. The wide-body fleet will need 8,600 new airplanes.”
The Airbus report is a bit less optimistic, projecting 20-year new aircraft demand at 31,358 units, though most of the difference is definitional. Airbus indicates that short-haul, single-aisle aircraft (between 100 and 210 seats) are the “workhorses” of the industry. About 22,100 of these aircraft will be required during the next 20 years – 12,500 for fleet additions in growing markets and 9,600 to replace aging planes in service. The balance of forecast airplane demand will be accounted for by wide-body aircraft for long-haul and freight operations, both of which are considered growth markets.
Airplane technological development, according to Boeing, “is aimed largely at improving airplane operating economics, which directly affect airline profitability. Fuel is expected to remain the largest component of airplane operating cost, so technology development efforts focus strongly on reducing fuel consumption. The latest generation of Boeing airplanes ... reduce fuel consumption by double-digit percentages compared with earlier-generation airplanes. Developments in engine technology made possible by advances in materials, aerodynamics and manufacturing techniques drive much of the improvement. Advances in wing design also contribute to better fuel efficiency.”
Whichever forecast you want to believe, many planes will be ordered during the next two decades, and that is good news for the global forging industry. The world’s leading forgers, many of which are located in North America, will be asked to supply a wide assortment of forged products made of high-performance and lightweight materials.
We have two words of advice for those serving the aerospace market: Be ready.
Dean M. Peters, Editor