Market Aspects

Abstract

This chapter describes the strategic importance of aerospace, the link between military and civil transport, the strong US dominance in the civil market in the 1960s and 1970s and the creation of Airbus in Europe, leading finally to a duopoly in the civil transport market for aircraft with more than 120 seats. Specific aspects of the aeronautical industry are the very long development cycle of an aircraft, where invested money will only be recovered after 12–20 years. National support is therefore needed, leading however to a constant fight between the US and Europe in front of the World Trade Organization WTO. New entrants are on the horizon to challenge the duopoly from the lower market area. Market forecast methods are described in detail and the outlook from industry for the next 20 years is presented, identifying a huge growth market with a doubling of the number of aircraft for this period. The air freight market with its specific elements is outlined, and the refurbishing of elder passenger aircraft into freighter aircraft is a main driver in the passenger market. Reflections about the importance of cost and commonality aspects conclude the chapter.