Wide-body Aircraft Engine Market to Witness Growth Owing to an Increase in Passenger Traffic | Technavio

05-Oct-2017 Intellasia | BusinessWire | 2:43 AM Print This Post

LONDON–(BUSINESS WIRE)–#AerospaceComponentsTechnavio
market research analysts forecast the global
wide-body aircraft engine market
to grow at a CAGR of more than 3%
during the forecast period, according to their latest report.


The market study covers the present scenario and growth prospects of the
global wide-body aircraft engine market for 2017-2021. The report also
lists small and medium wide-body and large wide-body aircraft as the two
major application segments, of which the small and medium wide-body
segment accounted for close to 80% of the market share in 2016.

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Technavio analysts highlight the following three market drivers that are
contributing to the growth of the global wide-body
aircraft engine market
:

  • Increase in passenger traffic
  • Advancement in existing gas turbine technologies
  • Enhancement in aircraft and engine leasing opportunities

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Increase in passenger traffic

Increase in the global air passenger traffic has always been the most
notable propelling factor for the year-on-year growth of aircraft and
associated parts and components markets. As wide-body aircraft can fly
more number of passengers on longer routes, it is also anticipated that
the growth in passenger traffic will substantially contribute to the
increased demand for wide-body aircraft and associated engines.

Traditional aviation (full-service or FSC) has a longstanding history of
inducting wide-body aircraft into operation, considering the demand for
improved flight-experience and the need for making long-haul flights.
However, over the years, the demand for wide-body aircraft has reduced
to a large extent due to the adoption of business models focused toward
leveraging cost optimization. Yet, it is expected that regions like
Europe and the Middle East will contribute significantly to the growth
of the global wide-body aircraft engine market during the forecast
period.

Advancement in existing gas turbine technologies

The main aim of aircraft operators/airlines is to employ operational
engines that can reflect increased fuel efficiency and lower the overall
cost incurred during operation or maintenance. Therefore, operators are
emphasizing on selecting advanced materials that will extend the
durability and service life of the engine and ensure efficient
performance.

“Aircraft OEMs, along with engine manufacturers, have been
extensively employing improved engines in their new aircraft designs to
achieve enhanced performance and range of aircraft. This also helps in
ensuring the viability of the aircraft in the highly competitive and
rapidly evolving aerospace industry. Such developments will lead to the
adoption of wide-body engines during the forecast period,”
says
Ramyabrata Chakraborty, a lead analyst at Technavio for aerospace
components
research.

Enhancement in aircraft and engine leasing opportunities

A new engine can account for around one-third of the total aircraft
cost. Therefore, the lack of adequate funds for procuring new aircraft
can hinder the adoption of new engines. As airlines mostly operate in
the low-profit margins, it becomes challenging for them to pay
significant amounts for the purchase of fleets or new engines. However,
with the evolving dynamics of aircraft or engine leasing businesses,
airlines can access the comfortable option of for leasing new aircraft
or new engines in their fleets through aircraft financing entities. Such
a model provides financial relief to airlines as well as allows them to
avail temporary access to an increased capacity.

“With the growing demand for next-generation aircraft and engines,
prominent engine lessors like GE Capital Aviation Services and AerCap
are focusing on enhancing their purchase and leaseback options for
engines that are manufactured by prominent players like GE Aviation and
Rolls Royce. Such emerging trends of leasing activities are anticipated
to channelize more funds for the procurement of wide-body aircraft and
associated engines during the forecast period,”
says Ramyabrata.

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