Global Aviation Takes Off Again As Fleet Is Just Short of Pre-Pandemic Peak
February 23, 2023
T: +44 7825 193311
Follow us on Twitter @OliverWyman
New York, February 24, 2023 – Oliver Wyman, a global management consulting firm and a business of Marsh McLennan (NYSE: MMC), has launched today its Global Fleet and MRO Market Forecast 2023-2033.
The Fleet and MRO Forecast finds that with the global fleet at 98% of where it was pre-pandemic, airlines are set to return to profitability, and aerospace manufacturers are gearing up for their most productive years yet:
- The worldwide commercial fleet is projected to expand 33% by 2033 to well over 36,000 aircraft, representing a compound annual growth rate of 2.9%.
- Today it numbers almost 27,400, just short of its size in January 2020 — the last month before COVID-19 changed the economy and everyday lives around the globe. And even with 2022’s Ukraine war, global inflation, and higher interest rates, the in-service fleet still managed to increase 7% between January 2022 and January 2023 year-over-year.
- Aviation’s global aftermarket, which provides the maintenance, repair, and overhaul (MRO) to keep the fleet flying, expanded 18% in 2022 and is expected to grow another 22% this year, topping
$94 billion — a mere 2% below its 2019 peak. By 2033, it will reach $125 billion — a compound annual growth rate of 2.9%.
- Oliver Wyman anticipates a record number of aircraft deliveries over the next 10 years, even though currently supply chain constraints are making it hard to meet this year’s targets.
- Despite rising air fares and a year of delays and cancellations in many of the world’s
biggest markets, travelers seem undeterred. By December, global passenger traffic — including both domestic and international — reached 82% of the 2019 total. That’s the highest level since
However, the Fleet and MRO Forecast also highlights the significant headwinds that the industry continues to face in the next decade, including tight labor markets globally across almost every aviation job category — from pilots and mechanics, to ground crew and air traffic controllers. Oliver Wyman’s analysis finds that the supply gaps already amount to 18% of the total pilot workforce in 2023 and 14% of aviation mechanics.
Additionally, ongoing production delays linked to supply chain disruption and higher operating costs continue to strain growth projections – price increases have touched everything from jet fuel and salaries to aircraft parts, already putting pressure on airline earnings in 2022.
Despite improved engine efficiency and the anticipated switching out of older, less efficient aircraft for new ones, aviation will likely face rising emissions this decade, given strong demand for air travel and the lack of alternatives to current jet propulsion. And airlines will probably have to contend with stricter rules moving forward.
Lastly, geopolitical tensions, especially with China and Russia, loom large. China’s zero-COVID policy caused lockdowns that cut into supplies of certain aircraft parts and raw materials and closed off MRO capacity to Western airline customers. Meanwhile, Russia’s estrangement from the global community is likely to decimate its fleet with Oliver Wyman predicting a 25% decline over the next 10 years because of the sanctions.
Brian Prentice, Partner, Oliver Wyman, and the head of the fleet research study, said: “This industry has been jostled by enormous turbulence since the start of COVID-19, but 2022 proved its resilience. The next 10 years look even brighter as fleets expand to meet growing consumer demand for travel and we see the potential for dramatic growth in emerging markets like India. However, the complex challenges facing the industry are significant, and will require developing innovative solutions to meet the growing demand for air travel.”
About the Global Fleet and MRO Market Forecast 2023-2033
The 2023-2033 edition of Oliver Wyman’s Global Fleet and MRO Market Forecast represents its more than two-decade commitment to the understanding and assessment of the commercial airline transport fleet and the associated MRO market outlook. The commentary is the go-to resource of aviation executives—whether a manufacturer, operator, or aftermarket provider, as well as for those with financial interests in the sector through private equity firms and investment banks.
This year’s research focuses on the aviation industry’s growth trajectory despite geopolitical and economic headwinds.
About Oliver Wyman
Oliver Wyman is a global leader in management consulting. With offices in more than 70 cities across 30 countries, Oliver Wyman combines deep industry knowledge with specialized expertise in strategy, operations, risk management, and organization transformation. The firm has more than 6,000 professionals around the world who work with clients to optimize their business, improve their operations and risk profile, and accelerate their organizational performance to seize the most attractive opportunities. Oliver Wyman is a business of Marsh McLennan [NYSE: MMC].
For more information, visit www.oliverwyman.com. Follow Oliver Wyman on Twitter @OliverWyman.