North America Aviation Market - Growth, Trends and Forecast (2018 - 2023)
Business Jet segment of general aviation is expected to dominate with significant market share in the region. In 2016, there are more than 416,000 general aviation aircraft in the worldwide fleet, ranging from small training aircraft and helicopters to intercontinental business jets. About 210,000 of these or half the market share is occupied by the US. However, deliveries of general aviation aircraft are still way below their 2007 peak levels, both worldwide and in the U.S., because the price per aircraft has doubled.
In 2016, the US Federal Aviation Administration (FAA) selected two unleaded aviation fuels, developed by Shell and Swift Fuels, for testing as part of its effort to qualify and deploy an unleaded aviation gasoline to replace the 100 low-lead avgas currently used in the piston aircraft fleet. Successful transition from leaded to unleaded avgas will mean the continued safety and utility of the fleet and a reduced environmental impact. This becomes more important in the context of recent adoption of Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) framework, which aims to adopt carbon neutral growth from 2021 onwards.
The Federal Aviation Administration’s (FAA) new Part 23 rule is expected to revolutionize standards for airplanes weighing 19,000 pounds or less and with 19 or fewer passenger seats by replacing prescriptive requirements with performance-based standards coupled with consensus-based compliance methods for specific designs and technologies. The rule also adds new certification standards to address general aviation loss of control accidents and in-flight icing conditions. It is also expected to promote regulatory harmonization among the FAA’s foreign partners, including the European Aviation Safety Agency, Transport Canada Civil Aviation, and Brazil’s National Civil Aviation Authority. Such harmonization may help minimize certification costs for airplane and engine manufacturers, and operators of affected equipment, in turn driving the market.
Commercial Aircraft Sector
North America accounts for one-third of all commercial jets in service in the world today. This large current fleet of airplanes represents a significant market for replacement over the forecast period. It is estimated that the region will require 8,640 new airplanes over the next 20 years, and 65 percent of these will be needed to replace airplanes in the existing fleet. Intra-North America is the largest intra-regional market, accounting for 16 percent of global passenger traffic in 2016. Although the 2.6 percent long-term traffic growth rate forecast for intra-North American is below world average, the size of the intra-North American market provides strong support for single-aisle airplane demand growth in the region.
In long term, the forecast shows international traffic growing faster than intra-North America, roughly 4 percent per year. Small widebody planes, projected to account for 72 percent of total widebody passenger deliveries over the next 20 years, offer the ability for North American airlines to operate additional nonstop flights profitably from hubs as well as secondary markets as they take advantage of these market opportunities.
Key Developments in the Market