Industry Forecast
North America
North American Market for Investment Castings
by Joseph E. Fritz, Executive Director, Investment Casting Institute M
ore often than not, ICI Members ask me what my “crystal ball” says about the industry or a
market of interest. The fact is, no one understands a market better than those working in it. It is for this reason that I rely heavily on the conversations that I have with our Members and their customers when it comes to analyzing market performance and future trends. That is not to imply that future projections are simply based on trend analysis. The data presented in this article, and the data that will be presented at the Business & Leadership Development Conference, is the result of a consolidated analysis of OEM production schedules, analyst forecasts, some conjecture and at times, a gut feeling.
Aerospace & Defense: Commercial Aviation
In spite of the grounding of the 737-8 Max, Boeing continued production of the aircraft until the end of December 2019, placing over 400 aircraft in storage awaiting delivery. This has had a serious impact on the company’s 2019 delivery performance. In the first 11 months of 2019, Boeing delivered 345 aircraft, compared to 704 for the same period last year. From another perspective, Boeing’s 2019 deliveries through November were less than half the number delivered by Airbus, who have reported deliveries of 725 airframes.
It should be noted that Boeing had originally anticipated FAA approval coming in November of 2019. The company has now taken a more realistic view of the situation with hopes of resuming production in late 1st or early 2nd quarter 2020. By halting 737-8 MAX manufacture, Boeing’s 2020 production plans are expected to be reduced by an estimated 120 to 160 aircraft, though the
10 ❘ January 2020 ®
number may be higher should airlines push out delivery requirements. Historically, the market for passenger jet aircraft has been cyclical, experiencing rises and falls every seven to eight years. For the past 14 years, aircraft deliveries have done nothing but grow, raising the question: “How long can this Super-cycle continue?” Looking back on past forecasts discussed
in INCAST Magazine since 2017, a lull in growth rate for a market correction had been forecast starting in the 2020- 2021 time frame. As market conditions continue to track to forecast, it is believed that the market correction will occur as anticipated. This anticipated market correction is partially due to a moderate decline in air traffic growth over the next several
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