2015 Commercial Aviation Growth Outlook

Commercial Aircraft

Part of finding success in any business venture is being able to anticipate the needs of your clients. In a global business like commercial aviation maintenance, repair and overhaul (MRO), this means looking forward, determining where your clients are headed and meeting them there with the parts and services they need for their own market expansion.

So where is the commercial aviation industry headed? In a word: Asia.

Aircraft manufacturer, Bombardier’s, growth forecast directly relates commercial airline travel with an uptick in per capita GDP. They anticipate a growth in personal income that will increase the world’s middle class population by another 3.1 billion over the next 20 years. 85% of this growth, and thus, the increase in demand for air travel will be coming from China, India and Asia Pacific (p. 10).

A recent FlightGlobal.com article reports that Airbus’s 2014-2033 Global Market Survey is expecting China to represent 17% of all new aircraft demand, with around 5,300 passenger and freighter aircraft purchases over the next 20 years. This growth will provide an opportunity for MRO providers to establish services within these emerging markets.

Conversely, Aviation Week reports that North American MRO needs are anticipated to stagnate as a result of refleeting and, thus, reduced maintenance. However, there are opportunities for growth if you know where to look. While in recent years, the article reports that 62% of wide-bodied aircraft have been sent out of the country for heavy checks, rising costs in China, where much of this work is outsourced, (remember that growing middle class), could bring it back stateside.

In Europe, the projected growth is expected to be moderate, says MRO-Network with the largest gains coming from Eastern Europe. However, they, too, encourage providers to seek opportunities in new places. One area in which they see a general need for improvement is better anticipating customer “buying behavior and the circumstances in which they operate.”

As an aircraft parts distributor, Kapco Global supplies more than 400,000 parts to a world-wide customer base. Our success depends on your success, and we want you to know we’ve been paying attention. With locations in Singapore and PR China, we are ready to meet the growing demand for parts and service in the developing Asian market. In the US, our distribution centers are strategically located throughout the country to supply and support the MRO industry as it reinvents itself and likely grows as a result of a changing world economy.

And in Europe, we’ve spent considerable time and effort researching local market demand in order to stock our shelves with inventory that reflects the needs of the MRO industry and the commercial aviation community it services. Our four European locations are ready to deliver the parts you need, and because we know time is of the essence, our locations are strategically positioned for delivery efficiency.

At Kapco, we see all these changes in the global marketplace as opportunities for growth and success. As a worldwide supplier of aircraft parts, custom kits, and supply chain/inventory management services, we are ready to meet the needs of our customers today, tomorrow and always. For more information on how we can serve you, contact us today.

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