Spain - Civil Aerospace: Increase in passenger volumes to drive aircraft deliveries (Strategy, Performance and Risk Analysis)
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In terms of nominal GDP, Spain is the fifth-largest economy in Western Europe. The country’s nominal GDP stood at US$1.2 trillion in 2016 and is anticipated to post a CAGR of 4.0% CAGR to reach US$1.5 trillion by 2021. Political instability and unrest over the independence of Catalonia are undermining investor confidence in the economy. Catalonia, which is highly developed in terms of infrastructure, makes a large-scale contribution to Spain’s GDP. Continued protests in the region will therefore have an adverse effect on economic growth. Agencia Estatal de Seguridad Aérea is the civil aviation regulatory body responsible for the supervision, inspection and coordination of air transport. It also involved in the detection, evaluation and mitigation of any security risks associated.
Increasing disposable income to drive passenger volumes
The volume of passengers increased at growth rate of 10.1%, from 60.6 million in 2015 to 66.7 million in 2016 and is forecast to post a CAGR of 4.5%, from 66.1 million in 2017 to 78.9 million in 2021. A rise in household income - which recorded a growth rate of 0.5% in 2014, followed by 2.1% in 2015 - and a decline in the country’s unemployment rate will positively contribute.
Aircraft capital expenditure to decline over the forecast period
Capital expenditure on aircraft in Spain stood at US$1.8 billion in 2016 and is expected to post a CAGR of -1.6%, from US$2.0 billion in 2017 to US$1.9 billion in 2021. However, an increase in the demand for airline services will propel the procurement of aircraft and related equipment. This will float capital expenditure until 2020.
Deliveries to increase over the forecast period
In Spain, the number of aircraft deliveries rose from 20 units in 2015 to 36 in 2016. The number of deliveries is expected to increase at a CAGR of 8.9%, from 32 units in 2017 to 45 in 2021. Passengers volumes will drive deliveries. Airbus accounted for the most deliveries, rising at a rate of 16.7%, from 18 in 2015 to 21 in 2016.
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