A Decade of Catching Up: Projected Global Fleet Changes Until 2031

After the COVID-19 pandemic left the world reeling, the aviation sector had to make quick and drastic adjustments to stay in business. The International Air Transport Association, for instance, estimates significant losses across the world: $118B in 2020, and $38.7B more in 2021. A new report by management consulting firm Oliver Wyman also sees a certain level of uncertainty over the next 10 years. Many factors will come into play that could accelerate or push back the projected recovery of the airline and MRO industries. 

Thankfully, with the rollout of vaccines now kicking into high gear, aviation and MRO can finally get started on the road to recovery and big changes lie ahead for the air transportation industry. For example, a more efficient vaccine rollout could help bring back passenger levels to pre-COVID days, while a shift in the retirement schedules of aircraft would also change MRO demand. Here are some of the most significant changes expected in global fleets in the next decade:

More in-service aircraft and travelers.

This is unsurprisingly one of the biggest changes expected. After dipping to as low as 13,000 in-service aircraft in 2020, data projects about 23,700 operational aircraft in 2021 and up to 36,500 by 2031. This is good news despite the numbers being lower than the pre-COVID estimates. The passenger fleet itself is expected to increase by 2.5% yearly, with 34,000 out of the 36,000 aircraft being passenger planes by the turn of the decade.

An older, different fleet.

Oliver Wyman’s Global Fleet & MRO Market Forecast Commentary 2021-2031 also predicts an increase in the average age of fleet aircraft. From 12.1 years, this is expected to go up to 12.8 years because of delayed retirements and new aircraft deliveries. To put things into perspective, 1,400 aircraft retired worldwide in 2020, a staggering double the average annual level between 2011 and 2019. In response, expect to see fewer retirements in the next couple of years before things go back to normal level.

Aside from the age, the distribution in the type of in-service aircraft is also expected to shift. Projections show an increase in the number of narrowbody aircraft compared to widebody aircraft as the industry turns its efforts toward improving load factors.

A shift to greener aircraft.

With the world starting to get its bearings with regards to COVID-19, nations can now focus on issues that were put in the backburner temporarily. Climate change is one of those concerns, especially as the U.S. rejoins the Paris Climate Accord. The short-term increase in aircraft retirement clears the way for the modernization of the fleet, leading to the improvement of overall fuel efficiency. At the same time, manufacturers themselves are working on zero-emissions aircraft in order to minimize carbon dioxide emissions. 

Clearer Skies and Positive Projections

Overall, the Oliver Wyman report predicts that the world may see pre-COVID passenger levels as early as the end of 2022, with a compound annual growth rate of 3% until 2031. This shows that while expectations are down, growth is still expected. 

All of the changes in the global fleet are expected to affect the performance of the Maintenance, Repair, and Operations Industry as well. MRO spending dropped from about $40B in 2020 because there were fewer aircraft needing maintenance, but the demand is expected to rise again to as much as $115B by 2030. It remains to be seen what type of MRO services will be prioritized in the coming years, because this depends on the aircraft that will be favored during that time. 

Business Goes On for Aviation and MRO

It’s not exactly business as usual for these two industries, but one thing is for sure: planes will continue to fly and need maintenance over the next 10 years. And whether there are more or fewer in-service aircraft compared to estimates, it doesn’t change the fact that operational planes need to have as little service time as possible. As the industries embark on the journey to recovery, tools such as automated line managers or warehouse managers will be invaluable to airlines and MROs in maximizing profit margins amid the ongoing slump. 

Visit www.empowermx.com to learn more about how you can optimize your MRO operations.