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Aerospace industry .... set for solid growth

ME travel driving commercial aircraft sales

BEIRUT, June 22, 2015

The primary drivers of new commercial aircraft sales include increased travel demand, especially in the Middle East, India, and China, as well as replacement of obsolete aircraft with new fuel-efficient models, a report said.

While revenues in the commercial aerospace subsector increased by $23.7 billion in 2014, global aerospace and defence companies added $12.7 billion in revenues, according to a study of the top 100 global aerospace and defence companies published by Deloitte, a leading provider of audit, tax, consulting, and financial advisory services.

The strong growth in the commercial sector was partly offset by revenue declines in the defence subsector, which experienced an $8.2 billion decrease in revenue from 2013 to 2014.

The analysis entitled “2015 Global aerospace and defence sector financial performance study”, found that the commercial aerospace subsector in 2014 set new records for sales totalling 2,888 orders; a 6.1 percent increase in deliveries to 1,352 planes; a 14.4 percent growth increase in backlogs reaching a record high of 12,175 aircraft; and revenues reaching  $314.9 billion.

The story is not so bright for the defence subsector with a 2.2 percent revenue decline in 2014, said Tom Captain, Deloitte Global Aerospace and Defence sector leader.

“Led by the largest country defence industry, the US has lost close to 168,000 defence jobs since 2010 and revenues of approximately $11.5 billion in the same period,” he added.

However, defence spending is increasing in several areas of the globe. The UAE, Saudi Arabia, India, South Korea, Japan, China, Russia, and other affected governments have and are expected to continue to increase purchases of next generation military equipment.

From a regional viewpoint, the study found that aerospace and defence companies headquartered in the US accounted for $408.5 billion of the global aerospace and defence sector revenue, while European companies accounted for $222.8 billion in 2014.

“Europe is also a critical geographic region representing nearly 33 percent of total global aerospace and defence revenues,” said Captain.

In terms of the outlook for 2015, Captain expects global aerospace and defence industry revenues to grow by 1.5 percent, a slowdown from 1.9 percent global industry growth in 2014. – TradeArabia News Service




Tags: aerospace | Middle East travel |

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