Aviation - Industry - Global Market, Share and Trends 2023-2028

Summary of Aviation

The aviation industry plays a vital economic and social role, supporting millions of jobs and facilitating trade and tourism worldwide. However, the sector faces significant challenges in adapting operations to meet new sustainability imperatives and harness emerging technologies that could transform air travel over the coming decades. The global aviation market is poised to boom at a slow but steady pace with a CAGR of 5.23% from 2023 (USD 826 Bn) to 2028 (USD 1126.93 Bn).

Our report provides an in-depth examination of the key trends influencing the evolution of the aviation sector from both environmental and innovation standpoints. Shifting patterns in passenger demand dynamics are explored, from the rise of low-cost carriers and budget travel to growing long-haul leisure and business markets. The emergence of urban air mobility solutions is also analyzed, with electric vertical take-off and landing aircraft poised to reshape short-haul mobility in dense urban areas.

Both the opportunities and risks associated with aviation’s energy transition towards alternative fuels and more efficient aircraft designs are assessed. The business model implications of deploying electric and hybrid-electric aircraft over the next 10-15 years are discussed. Airlines are attempting to cut emissions in a number of ways. Most likely the most popular is moving away from conventional jet fuels generated from fossil fuels and toward fuels made from renewable resources with reduced production emissions. In an effort to make aircraft lighter, more aerodynamic and more resilient to abrasion– airlines are also exploring novel materials and coating technologies.

Recent Trends and Insights

Electric vertical take-off and landing (eVTOL) aircraft are advancing, with several completing test flights and certification targeted for 2024-2026. These challenges remain around battery technology, air traffic management and public acceptance.

Different airline companies have announced programs to try to become more sustainable in the coming years. Delta Air Lines recently committed $1 billion to become carbon neutral by 2030. JetBlue pledged to get there by 2040, and United Airlines by 2050. Many other global airlines around the world have made similar promises.

More than 200 companies have signed The Climate Pledge, pledging to achieve net zero by 2040, and more than 5,000 have joined the UN-backed Race to Zero, pledging to achieve net zero carbon emissions by 2050—without the use of offsets.

Improved fuel efficiency in new aircraft models is helping to reduce emissions but sustainable aviation fuel (SAF) remains in short supply, accounting for only around 0.1% of total jet fuel demand globally and it is critical to reach these demands to meet the set long term decarbonization goals.

Product Insights

Newer aircrafts are trying to gain up the competitive edge by making the air travel more sustainable. Major aircraft OEMs are certifying new, more fuel-efficient aircraft models like the Airbus A320neo and Boeing 737 MAX– which are up to 20% more efficient than previous generations.

Expanding supplies of drop-in biofuels and synthetic fuels will be critical to deep decarbonization. Aircraft OEMs are partnering with airlines on hybrid-electric and hydrogen fuel cell aircraft demonstrators targeting the 2030s for commercialization. New propulsion technologies are key to reducing emissions from long haul flights.

Airport infrastructure is undergoing significant investment in new terminals, runways and facilities to enhance the passenger experience and boost capacity.  Air traffic management (ATM) systems from companies like Thales and Indra are increasingly utilizing artificial intelligence and cloud technologies to optimize airspace usage and flight paths and reduce delays.

In-flight connectivity providers like Viasat and Intelsat are upgrading satellite fleets to expand coverage and boost bandwidth to meet growing passenger demand for inflight WiFi. Aircraft leasing has grown rapidly, with lessors like AerCap and SMBC Aviation leasing over 30% of the global fleet. This sector facilitates airline fleet renewal and provides capital.

Key Companies

Some major players within this vast domain of industry are

• Honeywell International Inc.
• Collins Aerospace
• Boeing
• L3Harris Technologies, Inc.
• Oracle
• SAP SE
• General Electric
• IBM
• Lufthansa Technik
• Airbus

Regional Analysis

The Middle East region continues to see strong growth, led by hub carriers Emirates, Etihad and Qatar Airways. The UAE has emerged as the largest individual country market due to the strength of these three major airlines. The MENA region is also investing heavily in its aviation sector as part of efforts to diversify its economy and improve regional connectivity. Other countries within this region have sizable domestic markets but international traffic growth is currently limited by geopolitical factors.

Asia Pacific remains a major driver of long-term demand growth in the industry. China now has the largest aviation market globally thanks to robust domestic and international travel increases. Other regions are also experiencing rapid expansion as income rises and is projected to become the third largest aviation market by 2030. Other fast-growing Southeast Asian countries are opening up significant opportunities. Other established and mature markets continue expanding at a steady pace.

Europe remains centered around its large Western economies like Germany, the United Kingdom and France. Italy, Spain, the Netherlands & other countries have sizable tourism and business travel sectors catering to strong intra-European demand. Eastern European countries are experiencing more varied performance, with Russia’s international traffic currently restricted due to sanctions. Overall traffic within Europe is rebounding strongly from the pandemic but faces challenges from rising costs and capacity constraints.

In North America– the sheer scale of the United States domestic market gives it over 70% of the region’s total aviation activity. Canada has a mature– steadily growing market as well– with passenger traffic projected to increase 3-4% annually on average. Other regions showcase a smaller growth than Canada but sees stronger growth rates of 4-5% annually driven primarily by tourism to destinations and frequent business travel. Many regions continue deepening their integration within North American air transport networks.

Market Segmentation

By Type:

• Commercial aviation
• General aviation
• Military aviation
• Civil aviation

By End User:

• Airports
• Aircraft manufacturers
• Aviation service providers
• Aviation authorities

By Sub-Sector:

• Domestic aviation
• International aviation
• Regional aviation
• Low-cost aviation
• Business aviation

By Region:

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East and Africa

Our Methodology

We have offered a well-founded review of the global aviation industry along with ongoing trends and upcoming projections to highlight proximate investment opportunities in this report. Moreover, an extensive analysis of any future prospects, challenges, competitors, or navigating aspects is also provided. A methodical detailed regional examination is presented.

Primary Research  

Our multi-pronged research approach includes interviews with industry leaders and a global survey of advanced manufacturing professionals to gain qualitative insights. We utilize our proprietary databases encompassing key performance indicators worldwide in order to collate relevant data points. A multivariate forecasting framework considering historical performance, current dynamics and qualitative factors are utilized to develop market sizing and growth projections through 2029.

We supplement our primary research with a careful examination of secondary materials such as– case studies, news stories and references from other sources. Organizations can benefit from the strategic advice and conclusions offered because they will be better equipped to respond to the dynamic nature of this industry and seize emerging possibilities.

We employ a comprehensive and iterative research methodology focused on minimizing deviation to provide the most accurate market estimates. Our research utilizes a combination of bottom-up and top-down approaches across segments and utilizes databases, primary research insights and industry experts for analysis.

Raw data is obtained from multiple sources and thoroughly filtered to ensure only authenticated and validated sources are considered. We collect data from raw material suppliers, industry associations, technology providers, and buyers to gain a holistic perspective.

Quantitative Analysis

Our market estimates are derived through statistical models, beginning with collection of historical data and analysis of macro- and micro-economic factors influencing the market. Gathered information on market dynamics, technology and pricing trends are utilised to build the models.

Econometric and technological models are applied to project short- and long-term market potential respectively. A bottom-up approach is preferred to minimize errors. Key parameters considered include market drivers and restraints, material pricing trends, regulatory scenarios, and capacity additions.

Weights are assigned to these parameters based on impact analysis and market forecasting is performed via statistical tools and techniques. We believe this methodology results in an accurate and realistic market picture.