Business Aircraft Market to Soar Past $100 Billion during Decade
NEWTOWN, CT---The booming business aircraft market over the next 10 years will be worth $107.5 billion and involve production of more than 11,800 aircraft, according to a new study by Forecast International/DMS.
The World Market for Business Aircraft and Rotorcraft examines the market for business jets, corporate turboprops, fixed-wing piston-powered business aircraft, and business rotorcraft and finds that bizjets will account for the lion's share of production. By 2010, Forecast International/DMS expects manufacturers to roll out approximately 6,690 business jets, representing more than 50 percent of all business aircraft production.
Right now, virtually all sectors of the business aviation market are prospering, however, the study cautions that the market may have peaked. Several factors -- including a slowing economy, higher jet fuel prices, and the prospect of new taxes, user fees, and regulations on business aviation -- point toward a decline in the market in the near term.
The outlook is not entirely negative, as the study notes that the business jet industry is in a considerably better position to ride out the storm than it was during its last downturn in the early 1990s. Order backlogs remain at very high levels, including those for several business jet types presently in development.
Another factor that should help temper the scope of the bizjet market's anticipated downturn is the emergence of the new fractional ownership programs. Already representing a considerable presence in the business aircraft market, fractional ownership programs have opened a new market of potential customers that otherwise could not afford a business jet. In addition, fractional ownership would provide companies with an option during poor economic times that they otherwise would not have.
Production in two market segments -- corporate turboprops and business pistons -- are expected to decline during the next 10 years. Meanwhile, bizjet production, after a three-year drop starting in 2002, should recover, although perhaps not to the level expected in 2001. Nevertheless, business jet production in any of the next 10 years is expected to comfortably exceed that of any year during the 1990s. The business rotorcraft market should grow through most of the forecast period, as companies increasingly view the rotorcraft as an important business tool.
As for market shares, Raytheon Aircraft is expected to retain its current position as the world's number one business aircraft producer when measured in annual unit production. Raytheon is expected to produce about 2,914 aircraft by the year 2010, a 24.7 percent share. Cessna takes the number two spot, with production of 2,126 aircraft for an 18.0 percent unit share.
Measured in terms of value of production, Cessna takes the top spot, with the value of its 10-year production expected to total $17.2 billion -- a 16.1 percent share of the total business aircraft market. Bombardier (not including its Learjet subsidiary) is second with an estimated $16.9 billion and 15.8 percent share. Adding Learjet's shares to those of Bombardier puts the Canadian company in first place, with production worth $24.6 billion, a 22.9 percent share.
Forecast International/DMS Inc., is the world's leading provider of Market Intelligence and Analyses in the areas of aerospace, defense, power systems and military electronics. Based in Newtown, CT, Forecast International specializes in long-range industry forecasts and is renowned for innovative marketing presentations, including regular 10-year forecasts.
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Business Aircraft Market to Soar Past $100 Billion during Decade
