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Sector Snapshot: Global Aerospace Industry

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Over half of the global aerospace and defence sector value is from the Americas. (Photo: Mike Gieson)
Over half of the global aerospace and defence sector value is from the Americas. (Photo: Mike Gieson)

BUSINESS

  • Promising increase in air traffic and military spending
  • US largest aerospace market, with EU and Canada closely following
  • Asia/Pacific region emerging as largest market for new orders

The aerospace industry has observed impressive growth over the past few years. Despite the recession, the industry remains promising due to an increase in air traffic and military spending.

The US continues to be the largest aerospace market, with the EU and Canada closely following. Investor focus should be more on developing countries, especially China and India, in the coming years.

The Asia/Pacific region is emerging as the largest market for new orders. China's government and private sectors have been pumping money into the aerospace industry. China is expected to purchase over 3,700 planes with an estimated $390 billion by 2028. Mexico and Brazil are also emerging as highly promising aerospace markets.

By 2029 growing demand will cause global airlines to have delivered 29,000 commercial aircrafts at a total value of $3.2 trillion. Overall, the global industry will grow 4.9% annually over the next twenty years.

The level of industry growth greatly exceeds the global GDP rate as well as the defense industry's forecast.

Sector Statistics – Global Aerospace and Defence Industry (source: Datamonitor)

  • Global aerospace and defence grew by 0.4% in 2009, reaching over $920 billion in value.
  • Increasing over 29% since 2009, the aerospace and defence sector is expected to have a value of over $1,190 billion by 2014.
  • Accounting for roughly 72% of the aerospace and defence industry, defence is the largest segment in the global sector.
  • Over half of the global aerospace and defence sector value is from the Americas.
  • The leading developing countries, including China, India, Brazil, Mexico, and South Africa are expected to reach a combined value of over $260 billion in 2014.
  • China is the top developing country in the aerospace and defence industry, with revenues of almost $90 billion.
  • China is expected to lead all nations in the aerospace and defence industry as of 2014, with over $185 billion in market revenues.
  • Boeing is the leading company of the industry, generating over 7% of the sector's value.

Key Players – Global Aerospace Industry

  • Arianespace SA, ATR, B/E Aerospace, Inc., BAE Systems Plc, Ball Aerospace & Technologies Corporation, Bell Helicopter Textron, Inc., Bombardier, Inc., CFM International Inc., DAHER-SOCATA, European Aeronautic Defense and Space Company (EADS), Airbus S.A.S, Eurocopter Group, Embraer -Empresa Brasileira de Aeron?utica S.A, Finmeccanica S.p.A., AgustaWestland S.p.A., GE Aviation, Goodrich Corporation, Gulfstream Aerospace Corporation, Hawker Beechcraft Corporation, Honeywell International, Inc., Ilyushin Aviation Complex JSC, IRKUT Corporation, Israel Aerospace Industries Ltd., Kaman Corporation, Lockheed Martin Corporation, Northrop Grumman Corporation, Pratt & Whitney, Raytheon Company, Rolls-Royce Plc, RUAG Aerospace, Sikorsky Aircraft Corporation, Snecma SA, Thales Group, The Boeing Company, and Turbomeca

Recent Industry Wins/News – Global Aerospace and Defence

  • Exponent Private Equity, which has bought Umeco, has announced that it will carve up Pattonair, the aerospace supplier of Rolls-Royce.
  • In the first quarter of 2011, mergers and acquisitions activity jumped in both volume and value for the aerospace and defense sector.
  • CAW and Northstar Aerospace have reached a deal that will prevent trade workers from halting work activity.

Upcoming Industry Events – Aerospace and Defence

  • Washington State Governor's Mission to the Paris Air Show, June 20-26, at Le Bournget, France
  • Aerospace Meetings, June 20-26, at Kuala Lampur, Malaysia

By Nicole Manuel for
Nicole Manuel is a freelance economics, finance and blog writer with a degree in economics and over two years of experience.

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