Industry Forecast
Rate of 0.1%. This will be offset by the recovering regional jet market, which will experience a Compounded Annual Growth Rate of 8.1% over the same period.
When considering sale of spare components, it is important to look at the total size of the commercial fleet. In this analysis, airframe retirements are subtracted from scheduled deliveries, resulting in a net effect to the fleet, which should exceed 31,000 units by 2021, and go onto surpass 32,000 units in 2022.
Since aircraft engines have to utilize
70% of the investment casting produced for this sector on a revenue basis, it is important to be mindful of the affect the correction will have on engine deliveries and the ultimate affect it will have on the number of engines in the fleet. In 2019, 4,136 engines were delivered to airframe manufacturers.
Approximately 800 of these engines are in the Boeing’s grounded 737-8 MAX inventory and will not be delivered to airlines until FAA approval has been granted next year. In 2020, only 3,972 engines are expected to be delivered to OEMs. This decline is due to the 737-8 Max production halt. Based on current schedules, engine deliveries to OEMs will top out at 4,232 by 2021 and remain relatively flat until 2023, which is expected to exceed 4,500 units. The net effect that engine deliveries
to the fleet less engine retirements is still one of growth, but at a declining rate. This is due in part to the replacement of older 4 engine airframes with 2 engine equivalents, thus reducing the average number of engines per airframe in the fleet to 2.2. The net effect on fleet engine growth is that the Compounded Annual Growth Rate will decline from its current 4.3% to 3.7% through 2022. It should be noted that although 4,136 engines were delivered to airframe manufacturers in 2019, only 3,336 of these engines were delivered to the airlines due to the 737-8 MAX grounding. These engines are expected to be put into service in 2020. Planned engine retirements, like corresponding
12 ❘ January 2020 ®
North America
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