Indonesia - Civil Aerospace: Shift towards indigenous aircraft (Strategy, Performance and Risk Analysis)
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Factors hindering economic growth include terror threats from militant groups and an underdeveloped financial market, which has resulted in liquidity issues for companies. However, due to an increase in investments by foreign forms, nominal GDP is expected to post a CAGR of 8.1%, to reach US$1.4 trillion in 2021. The Directorate General of Civil Aviation is the regulatory body responsible for the formulation and implementation of policy. It provides technical guidance, compiles standards and norms, and evaluates safety and service quality.
Demand for services to drive aircraft procurement
Passenger volume recorded an annual growth rate of 7.1%, from 90.1 million in 2015 to 96.5 million in 2016 and is anticipated to post a CAGR of 4.4%, from 100.3 million passengers in 2017 to 119.0 million in 2021. This is driving deliveries, which will grow at an annual rate of 6.0%, from 72 units in 2017 to 91 in 2021. Narrow-body aircraft deliveries are forecast to post a CAGR of 5.7%, from 64 in 2017 to 80 in 2021. Wide-body aircraft deliveries are expected to grow at CAGR of 8.3%, from eight units in 2017 to 11 in 2021.
Capital expenditure on aircraft and helicopters to increase
Capital expenditure on aircraft stood at US$5.0 billion in 2016 and is expected to post a CAGR of 3.8%, from US$5.4 billion in 2017 to US$6.3 billion in 2021. Capital expenditure on helicopters stood at US$57.7 million in 2016 and is forecast to post a CAGR of 4.6%, from US$69.4 million in 2017 to US$83.0 million in 2021 due to a demand for more medium-sized and heavy helicopters.
Air freight to grow in line with imports and exports
Freight recorded an annual growth rate of 22.7%, from 758.7 million ton-km in 2015 to 931.3 million ton-km in 2016. Freight carriage is forecast to post a CAGR of 2.0%, from 897.9 million ton-km in 2017 to 972.6 million ton-km in 2021.