A|D|S has published a forecast for the UK's aerospace sector and a summary from chairman Ian Godden.
Godden spoke in advance of the UK Government’s Budget statement on 23 March 2011, seeking to demonstrate the growth and wealth-creation potential of UK aerospace.
He said: “Not many people in this country realise that throughout the last severe recession there was one advanced manufacturing and engineering sector in the UK that continued to grow: aerospace. In 2009, it grew by 5 per cent.”
There were two reasons for this, according to Godden: the rest of the world – China, India, and the Middle East – continued to buy aircraft throughout the last three years and more importantly, unlike many other sectors in the country, we are a global leader and our market is not dependent on UK demand.
A|D|S’ chairman said the UK is number two in the world in the sector, with 17% global market share, employing over 100,000 people and generating over £22 billion in 2009.
Godden continued: “The outlook for this year and the next five years is even rosier. As air travel continues to become more accessible throughout the world, the forecast for the next 16 years is for a staggering 10 per cent growth per annum in India, 8 per cent per annum for China, 6 per cent for Brazil and 5 per cent for the rest of Asia. Even the mature regions of North America and Europe are expected to trundle along at 3 per cent and 2 per cent respectively. Furthermore, aircraft manufacturers have already announced that they will increase their rate of production as a way to address demand for retirements and growth.”
Airbus announced it will increase production of the A330 from 8 to 10 per month by early 2013, while the A320 will be hiked from 34 to 40 per month for the same time period. Boeing has also revised its production numbers: the 737 will increase from 31.5 to 38 on a monthly basis by the second quarter in 2013. Regarding the Boeing 777, production will already increase by mid-2011 from five to seven aircraft. Both Airbus and Beoing more than doubled their order intake in 2010, compared to 2009.
The backlog in the aerospace industry remains high with 30,000 aircraft to be delivered over the next 20 years. It is worth around £452bn, 17% of which – the UK market share – is £77 billion alone.
Godden said: “However, we cannot live off the past. The need for sustained research and development investment and the importance of government support as a part of this is crucial to ensure the strong future that is within our grasp, capable of being delivered and sustained amidst fierce international competition. Furthermore, this new breed of aircraft will be significantly more fuel-efficient.”
The UK aviation industry has produced a CO2 Roadmap demonstrating how, through the use of new technology, the UK aviation sector will meet the predicted threefold rise in demand to 2050 while reducing CO2 emissions back to 2000 levels over the same period.
A|D|S’s latest review of the market shows an expectation of over 4% world growth in aircraft deliveries over the next decade, a higher growth in the first three years, possibly reaching 6%-7% per annum, a large-scale recovery growth in business jets by over 10% per annum and growth of at least 3% for all aerospace sectors in the next two years.