The global air travel industry is rebounding, and the aviation sector is shifting towards greater efficiency and sustainability, driven by growing demand for air travel and the need to reduce carbon emissions.

Aircraft manufacturers, such as Boeing and Airbus, are entering a new phase of competition and innovation, with a focus on developing fuel-efficient aircraft.

According to Boeing, the company has reduced its demand estimate for new aircraft to 41,170, while Airbus expects higher demand with 39,490 aircraft sales.

The global single-aisle aircraft market is expected to reach $222.20 billion by 2030, growing at a CAGR of 12.5% from 2023-2030, driven by the expansion of low-cost carriers and the need for fuel-efficient aircraft.

Airbus has increased its production to 65 single-aisle aircraft per month by 2023, and plans to produce 70 aircraft by early 2024 and 75 by 2025.

The aerospace composites market is also growing, with a projected market size of $51.83 billion by 2027, driven by the demand for high-strength lightweight materials.

Sustainable aviation fuel is becoming increasingly important, with airlines such as Etihad Airways aiming to achieve net-zero emissions by 2050.

The aviation industry is expected to need significant changes in energy and fuel production infrastructure by 2050, with a predicted 5700% increase in energy demand for sustainable aviation fuel.

Boeing has acquired Spirit AeroSystems for $4.7 billion, aiming to regain profitability and improve its market share in the commercial airlines segment.

The aircraft leasing market is expected to exceed $453.2 billion by 2026, growing at a rate of 6.8% during the forecast period, driven by air travel rates and demand for fuel-efficient aircraft.

Overall, Airbus appears to be well-positioned to capitalize

The global air travel industry is rebounding, and the aviation sector is shifting towards greater efficiency and sustainability, driven by growing demand for air travel and the need to reduce carbon emissions.

Title:

Content: Friday, 08 September 2023 05:25 GMT

Global Single-Aisle Aircraft Market Is Projected To Reach The Value Of $222.20 Billion By 2030 X Herald

(MENAFN- Ameliorate Digital Consultancy) According to the latest report by Virtue Market Research, in 2022, the Global Single-Aisle Aircraft Market was valued at USD 86.6 billion and is projected to reach a market size of USD 222.20 billion by 2030. Over the forecast period of 2023-2030, the market is projected to grow at a CAGR of 12.5%.

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A prominent long-term driver for the Single-Aisle Aircraft market is the growing global demand for air travel. Even though the COVID-19 pandemic had a severe impact on the aviation industry, the long-term trend remains robust. The demand for single-aisle aircraft is fueled by several factors, including the expansion of low-cost carriers, increasing urbanization, and rising middle-class populations in emerging economies.

The COVID-19 pandemic had an unprecedented impact on the aviation sector, leading to grounded fleets, reduced passenger demand, and financial strain on airlines. This setback prompted airlines to rethink their fleet strategies, with some deferring aircraft orders and retiring older aircraft to cut costs. Additionally, the pandemic accelerated the adoption of safety and hygiene measures in aircraft cabins, leading to increased investments in cabin air filtration and touchless technologies.

A notable short-term driver for the Single-Aisle Aircraft market is the rebound in domestic and regional air travel. As countries reopen their borders and vaccination efforts progress, there is a growing preference for shorter flights, leading to increased demand for single-aisle aircraft. Airlines are reactivating grounded aircraft and placing orders for new, fuel-efficient models to meet this surge in regional travel.

An exciting opportunity in the Single-Aisle Aircraft market is the development of next-generation, fuel-efficient aircraft. With a growing emphasis on sustainability and reducing carbon emissions, aircraft manufacturers are investing in research and development to create more eco-friendly models. This includes the use of advanced materials, aerodynamic improvements, and more efficient engines. Airlines that invest in these next-gen aircraft can not only reduce their environmental footprint but also benefit from lower operating costs in the long run.

One of the prominent trends observed in the Single-Aisle Aircraft industry is the rise of digitalization and connectivity. In-flight Wi-Fi, entertainment systems, and integrated passenger services are becoming standard features in modern single-aisle aircraft. Airlines are leveraging these trends to enhance the passenger experience and gain a competitive edge. Additionally, digitalization plays a crucial role in aircraft maintenance and operations, helping airlines optimize their fleet performance and reduce downtime.

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Segmentation Analysis:

The global Single-Aisle Aircraft Market segmentation includes:

By Type of Aircraft: Narrow-Body, Wide-Body, Regional Aircraft

Among these, the Narrow-Body aircraft category stands out as the largest segment. These aircraft are designed for short to medium-haul flights and are favored by airlines for their versatility and cost-efficiency. Narrow-Body aircraft are well-suited for both domestic and international routes, making them the preferred choice for many carriers.

In terms of growth, the Narrow-Body segment takes the lead yet again. The market for Narrow-Body aircraft is witnessing significant expansion due to the increasing demand for regional and domestic travel. Airlines are looking to replace older aircraft with more fuel-efficient and environmentally friendly Narrow-Body models, driving the growth of this segment.

By Engine Type: Turbofan, Turboprop

Among these categories, Turboprop engines are the largest segment. These engines are commonly found in regional aircraft that operate shorter routes and require a different set of performance characteristics compared to their Turbofan counterparts. Turboprop engines are known for their fuel efficiency and reliability, making them a preferred choice for regional carriers.

However, when it comes to growth, Turbofan engines take the lead. The demand for Turbofan-powered Single-Aisle Aircraft is on the rise, driven by the need for higher efficiency, reduced emissions, and greater operational range. Airlines are increasingly opting for Turbofan engines in their narrow-body aircraft to meet the growing demand for longer-haul regional and international flights.

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Regional Analysis:

The Single-Aisle Aircraft market spans across variregions, including North America, Europe, Asia-Pacific, South America, and the Middle East & Africa. Each of these regions has its unique characteristics and influences on the market.

Asia-Pacific emerges as the largest region in this segment. This region encompasses numerfast-growing economies, a burgeoning middle class, and a robust travel and tourism industry. As a result, airlines in Asia-Pacific have been expanding their fleets to meet the increasing demand for air travel. With a foon domestic and regional routes, narrow-body aircraft have been particularly favored in this region, contributing to its leadership in the Single-Aisle Aircraft market.

In terms of growth, Europe takes the lead. Despite being a mature aviation market, Europe is experiencing a surge in demand for narrow-body aircraft, primarily due to the need for more fuel-efficient and environmentally friendly options. European airlines are increasingly looking to modernize their fleets with state-of-the-art single-aisle aircraft, thereby driving the growth of this segment in the region.

The Middle East & Africa region also shows promise in terms of growth, driven by the emergence of airlines in the Middle East as major global players. These airlines are expanding their networks and investing in modern, fuel-efficient narrow-body aircraft to meet the growing demand for long-haul travel.

North America, with its well-established aviation industry, continues to be a significant market for single-aisle aircraft. While it may not be the fastest-growing region, North America remains a stable and vital market for these aircraft, catering to both domestic and international routes.

South America, although a smaller market compared to the other regions, also contributes to the demand for single-aisle aircraft. Airlines in South America are focusing on modernizing their fleets to enhance operational efficiency and reduce emissions.

Latest Industry Developments:

  • One of the key strategies adopted by companies is a strong emphasis on fuel-efficient and environmentally friendly aircraft. With the aviation industry facing increasing pressure to reduce carbon emissions, manufacturers are investing in the development of next-generation single-aisle aircraft with improved fuel efficiency. This includes the use of advanced materials, aerodynamic design enhancements, and the incorporation of more fuel-efficient engines. Furthermore, there is a growing trend towards the electrification of aircraft systems, including electric taxiing systems and more electric aircraft architectures. These innovations aim to reduce the overall carbon footprint of single-aisle aircraft, aligning with global sustainability goals.
  • To enhance their market share, aircraft manufacturers are expanding their global reach and customer base. They are targeting emerging markets with fast-growing air travel demand, such as Asia-Pacific and the Middle East. These regions represent significant opportunities for fleet expansion, especially with narrow-body aircraft designed for short- to medium-haul routes. Another trend is fleet modernization. Airlines, particularly in mature markets like North America and Europe, are retiring older aircraft and replacing them with state-of-the-art single-aisle aircraft. This trend is driven by the need to improve operational efficiency, reduce maintenance costs, and enhance passenger comfort. Manufacturers that offer the latest technology and fuel-efficient options have a competitive advantage in this regard.
  • Connectivity and digital solutions are becoming increasingly important in the aviation industry. Airlines are seeking aircraft equipped with advanced connectivity options to enhance the passenger experience, provide in-flight entertainment, and enable seamless inteaccess. Manufacturers are responding by integrating cutting-edge connectivity solutions into their single-aisle aircraft offerings. Additionally, the use of data analytics and predictive maintenance has gained prominence. Airlines are leveraging data from their aircraft to optimize operations, reduce downtime, and lower maintenance costs. Aircraft manufacturers are incorporating these features into their products to meet the demand for data-driven solutions.

About Us:

Virtue Market Research stands at the forefront of strategic analysis, empowering businesses to navigate complex market landscapes with precision and confidence. Specializing in both syndicated and bespoke consulting services, we offer in-depth insights into the ever-evolving interplay between global demand and supply dynamics. Leveraging our expertise, businesses can identify emerging opportunities, discern critical trends, and make decisions that pave the way for future success.

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What impact shall the carbon tax to be imposed by EU in 2026 have on aircraft market?

It is conducive to the sales of new aircraft with better fuel efficiency.

Aircraft manufacturers, such as Boeing and Airbus, are entering a new phase of competition and innovation, with a focus on developing fuel-efficient aircraft.

Title:

Content: ECONOMY
Boeing cuts its estimate of demand for new aircraft for the next 20 years
Thank you for reading the news that Boeing is reducing its estimate of the demand for new aircraft for the next 20 years and we assure you that we are always seeking to satisfy you and now with the details
Boeing expects global demand for new aircraft to rise until 2031, but has cut its industry-wide forecast for the next 20 years in the company's latest market outlook.
Boeing said in an annual market forecast released ahead of the Farnborough International Airshow in England that aircraft manufacturers are expected to deliver about 19,575 new passenger and cargo aircraft between 2022 and 2031.
Boeing now expects global demand to reach 41,170 aircraft over the next two decades, up from 43,610 a year ago, a drop even when taking into account Russian aircraft.
It based its forecast on lower growth and a more saturated aviation market in the second decade.
Unlike Boeing, Airbus expects there will be a greater need for new aircraft over the next 20 years than at last.
In its market forecast published a few days ago, it forecast sales of 39,490 aircraft by 2041, 470 more than last year's estimate to 2040.
Prospects for aircraft sales in the next 20 years:
Boing
AERBUS
Expect lower demand
41.17 thousand aircraft.
43.61 thousand aircraft a year ago
AERBUS
Expect high demand.
39.49 thousand aircraft
39.02 aircraft a year ago.
This was the details of the news of Boeing reducing its estimate of the demand for new aircraft for the next 20 years for today we hope that we have been able to give you the details and full information and to follow all our news you can subscribe to the system alerts or to one of our different systems to provide you with everything new.
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What impact shall the carbon tax to be imposed by EU in 2026 have on aircraft market?

It is conducive to the sales of new aircraft with better fuel efficiency.

What is Airbus doing to achieve sustainable aviation?

It is making efforts to improve aircraft efficiency.

It is working on adopting innovative strategies.

According to Boeing, the company has reduced its demand estimate for new aircraft to 41,170, while Airbus expects higher demand with 39,490 aircraft sales.

The global single-aisle aircraft market is expected to reach $222.20 billion by 2030, growing at a CAGR of 12.5% from 2023-2030, driven by the expansion of low-cost carriers and the need for fuel-efficient aircraft.

Airbus has increased its production to 65 single-aisle aircraft per month by 2023, and plans to produce 70 aircraft by early 2024 and 75 by 2025.

Title:

Content: Orders for Airbus are superior to Boeing.
T + T - normal size
The first major air transport exhibition, since the beginning of the spread of the coronavirus in Dubai, showed a great disparity in terms of trade performance between the European Airbus and the American Boeing as the sector emerges from the crisis that hit it for months.
As with every high-level international gathering in the sector, attention has focused on the two major aircraft manufacturers, who are scrambling to attract orders, but competition in Dubai has not been very intense, as Airbus appeared to have overcome the COVID-19 crisis with orders and agreements announcing intentions to sell 408 new aircraft, surpassing orders from the Paris exhibition in 2019, in exchange for contracts to sell 78 Boeing aircraft. G ".
The European manufacturer has hit hard since the first day of the Dubai show on Sunday with a firm order for 255 single-aisle A-321s, a plane whose range and capacity offer passengers flexibility that increases its appeal to airlines.
Airbus president Guillaume Fawry in Dubai said: “The prospects are beginning to blossom.
Airlines are also starting to look further ahead and prepare for the post-crisis period. ”
While global travel, still at half its 2019 level, is expected to recover between 2023 and 2025, demand for new aircraft should rise in the next 20 years, according to aircraft manufacturers.
Airbus expects to sell 39,000 planes and Boeing 43,000 to cope with the increase in travel and get planes that consume less fuel and thus emit less carbon dioxide.
The U.S. aircraft maker appeared conservatively at the show, announcing in a statement a major order for 72 single-aisle 737-MAX aircraft for India ’ s newly established Akasa Air.
The 737 Max crashes, 787 production problems and delays in the adoption of the future 777X wide-body aircraft caused the company to stumble.
Boeing Commercial Director Ehsan Munir told reporters that “safety and quality will be the guiding principles of everything we do. ”
The company showed at the exhibition the 777X aircraft for the first time outside the United States, in an indication of the near licensing, especially as the Dubai-based Emirates airline alone accounts for a third of the orders on the expected aircraft, but « Boeing » did not announce the start of the process of manufacturing a cargo version of the aircraft, as was hoped in Dubai, noting that this will be « soon ».
Airbus CEO Guillaume Fawry said the range of orders the company received at the Dubai Airshow this week had boosted its hopes of increasing production.
Airbus received 265 confirmed orders at the Dubai show, narrowing the gap with Boeing, which has topped sales this year as its 737 MAX emerges from a safety crisis.
A further 139 temporary orders raised Airbus ’ Dubai tally to more than 400 aircraft, while Boeing picked up firm orders for 72 MAX jets.
Airbus has agreed to increase production to 65 single-aisle aircraft per month by 2023 from an average of 45 scheduled for this quarter.
In addition, Airbus has asked suppliers to consider production rates of 70 aircraft by early 2024 and 75 by 2025, but has not yet made a decision.
Some suppliers have criticized the plans, expressing concern that recovery from the coronavirus epidemic remains incomplete.
Fawry told Reuters in an interview this week: “We are in the process of evaluating the application.
What happened (in Dubai) is important, because it gives, along with expectations and other upcoming deals, evidence that the demand we see for 70 / 75 will continue for many years. ”
The view of demand based on orders received by Airbus and its own assumptions based on conversations with airlines is in line with the picture provided by the new Airbus market outlook published at the show.
Airbus deliveries have fallen in the past three months, partly due to supply chain disruptions.
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The aerospace composites market is also growing, with a projected market size of $51.83 billion by 2027, driven by the demand for high-strength lightweight materials.

Title:

Content:
Navigating The Skies Of Growth: Global Aerospace Composites Market Insights

(MENAFN- EIN Presswire)

Aerospace Composites Global Market Report 2024 : Market Size, Trends, And Global Forecast 2024-2033

The Business Research Company's Aerospace Composites Global Market Report 2024 – Market Size, Trends, And Global Forecast 2024-2033

The 2024 Global Market Report on Aerospace Composites by The Business Research Company offers insights into market size, trends, and a global forecast spanning 2024-2033.” - The Business Research Company

LONDON, GREATER LONDON, UK, December 25, 2023 /EINPresswire / -- Year End Offer By The Business Research Company - Get 33% Discount On Opportunities And Strategies Reports And 25% Discount On Global Market Reports

Market Overview: Ascending from $26.25 Billion to $29.95 Billion in 2023
The global aerospace composites market experienced robust growth, advancing from $26.25 billion in 2022 to $29.95 billion in 2023, showcasing a remarkable Compound Annual Growth Rate (CAGR) of 14.1%. As the market evolves, it is poised for sustained expansion, projecting a market size of $51.83 billion by 2027, with a CAGR of 14.7%.

The global aerospace composites market is soaring to new heights, characterized by diverse fiber types, aircraft categories, manufacturing processes, resin varieties, and applications:
1 Fiber Type:
.Carbon Fiber Composites
.Ceramic Fiber Composites
.Glass Fiber Others
2 Aircraft Type:
.Commercial Aircraft
.Business & General Aviation
.Civil Helicopter
.Military Others
3 Manufacturing Process:
.AFP/ATL
.Lay-Up Process
.Resin Transfer Moulding Process
.Filament Winding Others
4 Resin Type:
.Benzoxazine
.Cyanate Ester
.Bismalimide
.Ceramic and Metal Matrix
.Thermosetting Others
5 Application:
.Interior
.Exterior

Explore the market with a detailed sample report:

Driving Force: Demand for High-Strength, Lightweight Materials The surge in demand for high-strength and lightweight composite materials is steering the aerospace composites market forward. The pursuit of energy efficiency and reduced fuel consumption is achieved through the use of lightweight materials, minimizing the aircraft's mass. This, in turn, leads to enhanced flight performance, structural strength, and stiffness, contributing to reduced carbon footprints. According to the '2020 State of the Industry Report' by Composites Manufacturing Magazine, the US composite end products market is anticipated to reach $33.4 billion by 2025, with glass fiber-based composites dominating the market.

Key Players Shaping the Horizon Major players shaping the aerospace composites market include Solvay, Toray Industries Inc., Mitsubishi Chemical Holdings, Hexcel Corporation, Teijin Limited, SGL Group, Spirit AeroSystems, Materion Corporation, Owens Corning, Spirit AeroSystems Inc., LEE Aerospace Inc., Gurit Holding AG, General Electric Corporation, Rolls-Royce Motor Cars Ltd., Kineco-Kaman Composites, and Nippon Graphite Fiber Corporation. These industry leaders contribute to market dynamics and foster innovation in composite material and process technologies.

Innovation Trends: Technological Advancements and Consortium Initiatives Companies in the aerospace composites market are steering their focus towards technological advancements to accelerate the development of next-generation aircraft and future mobility. Technologically advanced and modern aircraft, equipped with increased payload capacities and cost-efficiency, are replacing outdated models. For instance, GKN Aerospace, a UK-based company, launched the ASCEND consortium to advance lightweight structures, positioning the UK as a technology leader in future aerospace technologies. This initiative contributes to reducing carbon emissions and energy consumption in the aerospace industry.

Explore detailed insights into market trends, innovations, and growth opportunities with the complete report:

Regional Dynamics: North America Takes the Lead in 2022
In 2022, North America emerged as the largest region in the aerospace composites market. As the market evolves, Asia-Pacific is poised to be the fastest-growing region, offering significant opportunities for market players. The regions covered in the aerospace composites market report include Asia-Pacific, Western Europe, Eastern Europe, North America, South America, the Middle East, and Africa.

Aerospace Composites Global Market Report 2023 from TBRC covers the following information:
.Market size date for the forecast period: Historical and Future
.Market analysis by region: Asia-Pacific, China, Western Europe, Eastern Europe, North America, USA, South America, Middle East and Africa.
.Market analysis by countries: Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA.

Trends, opportunities, strategies and so much more.
The Aerospace Composites Global Market Report 2023 by The Business Research Company is the most comprehensive report that provides insights on aerospace composites market size, aerospace composites market drivers and trends, aerospace composites market major players, competitors' revenues, market positioning, and market growth across geographies. The aerospace composites market report helps you gain in-depth insights on opportunities and strategies. Companies can leverage the data in the report and tap into segments with the highest growth potential.

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Sustainable aviation fuel is becoming increasingly important, with airlines such as Etihad Airways aiming to achieve net-zero emissions by 2050.

Title:

Content: An Etihad Airways Boeing 787-10 Dreamliner nicknamed the "Greenliner" at the Dubai Airshow 2021
Thomas Pallini/Insider
  • Etihad Airways CEO Tony Douglas believes that airlines that don't focus on sustainability may be forced out of business.
  • More leisure travellers and businesses are focusing on the emissions of their travel and choosing green airlines.
  • Etihad is one of the airlines leading the charge in creating a sustainable future for aviation.
  • For more stories go to www.BusinessInsider.co.za.

Etihad Airways is betting all of its chips on sustainable aviation, and says that airlines that aren't doing the same might soon be "history."

Tony Douglas, Etihad's chief executive officer, told Insider at the Dubai Airshow in November that airlines will soon compete on environmental performance, and those that aren't making changes now could lose future customers.

"Increasingly, travellers will make choices that do include carbon emissions and therefore, the environmental performance [of their airline,]" Douglas said. "The people that don't respond in the sort of ways that we've been doing may well be history."

Etihad's ultimate goal is to achieve net-zero emissions by 2050 and cut its 2019 emissions in half by 2035.

The airline knows how to cut back on emissions but mastering the balancing act between environmental sustainability and economic sustainability remains elusive.

On October 23, Etihad flew its self-described "most sustainable flight ever" from London to Abu Dhabi, UAE in which it reduced emissions by 72% to a similar flight two years prior. From reducing plastic waste by using plant-based water bottles to reducing fuel burn by obtaining a more direct air route, the airline was able to reduce waste and save around 64 tonnes of carbon dioxide emissions.

A mixture of 62% traditional jet fuel and 38% sustainable aviation fuel, or SAF for short, powered the flight for additional carbon savings.

But replicating those sustainable conditions on every flight would be too costly for Etihad and the airline "would be insolvent within about 20 minutes," Douglas said, based on the cost of sustainable aviation fuel alone.

"The reason why we actually do these flights is to draw people's attention to the much larger challenges here," Douglas said. "Whilst I can predict an end to the pandemic… I actually don't predict an end to the challenge of commercial aviation sustainability."

Sourcing and using sustainable aviation fuel was a challenge as the fuel was brought in from Amsterdam and Etihad wasn't even able to fill the plane with as much of the biofuel as it wanted.

"There's no infrastructure to be able to deliver [SAF] directly to aircraft," Douglas, the former chief executive officer of Heathrow Airport, said. "You can't get prices down until availability goes up, but you're not going to get availability to go up until you get prices down."

Etihad's focus on sustainability came as a result of a restructuring plan undertaken by the airline after failed investments in foreign carriers such as Alitalia, Jet Airways, and Air Berlin, all of which have permanently ceased flying.

"The fallout from that was a transformation plan which had to radically reshape, resize, and get us on a sustainable footing," Douglas said of the investments. "It was analogous to open-heart surgery on the balance sheet."

That plan included a fleet renewal centered around leading next-generation aircraft from Airbus and Boeing.

Boeing's  787 Dreamliner, which Etihad nicknamed the "Greenliner," is currently Etihad's leading long-haul aircraft. Airbus' A350-1000 XWB aircraft, or the "Sustainable Fifties" in Etihad parlance, joined the fleet in 2019 but won't fly passengers until 2022.

An Etihad Airways Boeing 787-10 Dreamliner nicknamed the "Greenliner" at the Dubai Airshow 2021
Thomas Pallini/Insider

Etihad travellers are now being incentivised to make sustainable choices with the launch of the airline's "green loyalty" programme. Travellers with smaller carbon footprints, whether it be those travelling without extra luggage, will receive extra frequent flyer miles.

"The idea that this gets passed through to ticket prices to our guests, the travelling public, I actually find reprehensible," Douglas said of so-called green taxes on travellers. "There is a societal need to travel and therefore, penalising the passenger through increased ticket pricing I actually struggle with conceptually in one sense."

Competing airlines are "welcome" to copy Etihad's sustainable game plan, Douglas said, warning that those that don't might lose major corporate clients that are adopting new environmentally-friendly travel policies.

"I kind of feel for them because not everybody has the ability to do so," Douglas said of competitors that aren't taking sustainable measures. "Having said that, I think going forward it will be the principle differentiator of who succeeds and who fails.

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The aviation industry is expected to need significant changes in energy and fuel production infrastructure by 2050, with a predicted 5700% increase in energy demand for sustainable aviation fuel.

Title:

Content: Powering the sustainable aviation revolution

Atkins aerospace experts predict 44,000TWh of energy will be needed annually by 2070 to produce new, sustainable aviation fuell

A recent report released by sustainable aviation experts at Atkins, a member of the SNC-Lavalin Group, has cautioned that meeting the net zero targets set for 2050 in the aviation industry will necessitate significant changes in sustainable energy and fuel production infrastructure, particularly if commercial air transport continues to expand as expected.

The white paper, titled "Alternative Fuels for Sustainable Aviation," highlights that reducing carbon emissions in the aviation sector is not solely dependent on aircraft emissions. The report recommends the use of a mixture of alternative fuel options such as SAF, eFuel, Hydrogen, and batteries to achieve the most effective solution.

However, it also warns that the industry must be ready for the significant implications of utilising these alternative fuels and batteries to achieve the most effective solution. However, it also warns that the industry must be ready for the significant implications of using these alternative fuels and emphasises the significant impact on future energy demand that will be required to produce them.

Will we be generating enough aircraft fuel?

Based on estimated energy efficiencies and the predicted fuel mix, Atkins predicts that generating the necessary global aircraft fuel demand will require 44,000 TWh of energy per year by 2070. This represents a 5700% increase from current aviation energy generation requirements and is almost double the world’s current electricity demand.

It's not just energy generation that is now a concern, other considerations, such as fuel transportation and storage requirements, will also have to be taken into account.

Andrew Caughey, Sustainable Aviation Lead – Aerospace, Atkins says: “Aviation emissions are hard to abate, but not impossible. The sector is making huge strides in its efforts to accelerate the development of new fuels and aircraft that will help deliver zero emission flight. These advances have a wider impact beyond the aerospace industry. Whilst the future mix of low carbon alternative fuel is yet to be determined, the production, storage and transportation of fuels has implications for energy and airport infrastructure and their emissions need to be considered across the whole lifecycle, from ‘source to force’.

“Regions, governments, airports and the wider industry must adopt a holistic approach to scenario modelling when creating masterplans for the infrastructure and ecosystems that will drive the future of sustainable aviation. By understanding the full fuel mix and energy demands for sustainable aviation, governments can use the insight to inform their policy makers and actions – whether that be introducing emissions KPIs, green fuel subsidies, demand management or investing in innovation and development. Integrated system-level planning is vitally important in achieving the transition and must take into account future energy predictions.”

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Boeing has acquired Spirit AeroSystems for $4.7 billion, aiming to regain profitability and improve its market share in the commercial airlines segment.

Title:

Content: Free Trial

Major Acquisition: Aerospace Powerhouse Buys Its Key Supplier

Key Points

  • Boeing announced that it will acquire one of its key suppliers, Spirit AeroSystems.
  • The move should help Boeing fix quality control and safety issues.
  • Having more control of its supply chain will help Boeing regain profitability in the long run.
  • 5 stocks we like better than Airbus

Boeing Today

BA
Boeing
$184.61
+1.37 (+0.75%)
(As of 11:56 AM ET)
52-Week Range
$159.70
$267.54
Price Target
$220.89

Last week, Boeing NYSE: BA announced it is acquiring one of its key suppliers, Spirit AeroSystems NYSE: SPR, for $37.25 per share. The transaction represents an equity value of $4.7 billion and an enterprise value of $8.3 billion, as Boeing will assume $3.1 billion of Spirit's debt. At the time of the announcement, the sale price represented a 30% premium to Spirit’s stock price. Let’s break down the two businesses and the history of their relationship. Then, we can understand the reasons behind the decision and whether it makes sense.

Boeing's Segments and Key Partnership with Spirit AeroSystems

Boeing is one of the world’s major aerospace companies. It has three reportable segments: Commercial Airlines, Defense, Space & Security, and Global Services. Commercial Airlines develops and produces commercial jet aircraft and made up 44% of its revenues in 2023. The Defense, Space & Security segment produces military aircraft and weapons systems. It made up 32% of revenues in 2023. The Global Services segment provides many services for commercial and defense customers. It made up 25% of revenues.

Spirit AeroSystems is one of the world's largest producers of aerostructures for original equipment manufacturers (OEMs) such as Boeing and Airbus EPA: AIR. Aerostructures are the primary components of an aircraft's airframe, which is the fundamental mechanical structure of an airplane, excluding items such as passenger seats or cockpit control systems. Spirit’s core products include fuselages, wings, pylons, and nacelles.

Boeing and Spirit have a longstanding relationship. Boeing owned and controlled a significant portion of the firm's operations up until 2005. Spirit was then spun off into a standalone firm. As part of the spin-off, the firms entered into a lifetime agreement. Spirit would be the only supplier of aerostructures for Boeing’s commercial planes. This agreement applied to the B737, B747, B767, B777, and partially to the B787. Boeing's business made up 64% of Spirit’s net revenues in 2023, while Airbus accounted for 19%.

Boeing's Acquisition of Spirit to Address Quality Control and Safety Issues

Boeing decided to acquire Spirit to rectify quality control issues and signal to regulators that it is doing everything possible to make its planes safer. Safety concerns have been growing over the last several years. These issues started back in 2018 and 2019 when two 737 Max crashes left 346 people dead. Earlier this year, a portion of a 737 Max 9's cabin flew off the plane in midair, leaving passengers exposed. A terrifying video of the event surfaced online, adding to Boeing's public relations nightmare. This defect involved a mistake by Spirit’s employees failing to properly reinstall a panel they had repaired. More criticism came after questions about Spirit’s fuselage manufacturing caused delays in the production of 737 Max aircraft.

These safety concerns have damaged Boeing's market share in commercial airlines. In 2017, Boeing held a slight lead in net orders over Airbus. In 2023, Airbus accounted for 65% of net orders and 59% of deliveries.

A Long-Term Move to Regain Market Share and Restore Profitability

Ultimately, this acquisition makes sense. Shares are down 23% over the last three years, and something needs to change. Looking at the firm’s bottom line, it has been hemorrhaging money over the last five years. It cut its net loss by over half from 2022 to 2023, to $2.2 billion. However, this is far from the net income of $10.5 billion the firm earned in 2018. To regain profitability, the firm must dramatically increase its net orders and deliveries. Manufacturing airplanes is extremely expensive and has high fixed costs. To make up for this, Boeing needs to achieve economies of scale.

The Boeing Company (BA) Price Chart for Wednesday, July, 10, 2024

Spirit manufactures critically important parts of Boeing's planes. It is paramount to have full control over essential parts of its supply chain to efficiently produce planes at the level required to become profitable again.

Boeing would have liked to fix quality issues without paying billions for Spirit. But, it likely realized that wasn't possible. Spirit's CEO stepping down in 2023 demonstrates the internal turmoil at the firm.

Boeing’s share price has changed little since the announcement, which shows that investors are indifferent. However, this long-term move will be positive if Boeing shows it is fixing quality control issues. This will lead to more orders and deliveries over time, eventually helping Boeing’s stock price rise again. The average price target for Boeing implies an upside of 21% from the current level.

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Fundamental Analysis, Economics, Industry and Sector Analysis

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Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Boeing (BA)
2.8048 of 5 stars
$184.61+0.7%N/A-52.00Moderate Buy$220.89
Spirit AeroSystems (SPR)
1.3141 of 5 stars
$34.72+0.6%N/A-4.00Hold$33.42
Airbus (AIR)
0 of 5 stars
€131.84-2.8%N/AN/AN/A
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The aircraft leasing market is expected to exceed $453.2 billion by 2026, growing at a rate of 6.8% during the forecast period, driven by air travel rates and demand for fuel-efficient aircraft.

Title:

Content: Aircraft Leasing Market Overview by Recent Opportunities, Growth Size, Regional Analysis and Forecasts to 2032

The global aviation industry is experiencing unprecedented growth, fueled by increasing air travel rates and the demand for efficient aircraft. In tandem with this growth, the aircraft leasing market has emerged as a critical component of the aviation ecosystem, providing airlines with flexible leasing options to meet their fleet requirements. A recent report by Report Ocean forecasts that the aircraft leasing market size is poised to exceed USD 453.2 billion by 2026, with a robust growth rate of 6.8% during the forecast period.

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The global aircraft leasing industry is characterized by the presence of both international and small to medium-sized vendors. Leading companies such as Aviation Capital Group, Boeing Capital Corporation, Air Lease Corporation, and International Lease Finance Corporation dominate the market. These companies continually innovate and collaborate with other industry players to meet the evolving needs of consumers and launch new products to stay competitive.

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Overall, Airbus appears to be well-positioned to capitalize