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Analysis of Asia Pacific Aerospace Manufacturing Market and Emerging Supply Chain Dynamics
Frost & Sullivan, July 2011, Pages: 75
This Frost & Sullivan research service titled Analysis of Asia Pacific Aerospace Manufacturing Market and Emerging Supply Chain Dynamics provides industry and market analyses and detailed market forecast. In this research, Frost & Sullivan's expert analysts thoroughly examine the following markets: aero engines, airframes, fuselage, aero structures, after market and maintenance, repair and overhaul (MRO).
Market Overview
Cost Arbitrage and Favourable Regulations to Propel the $17.30-billion Asia Pacific Aerospace Manufacturing Market towards $28.10 Billion in 2016
Asia Pacific to Account for Nearly a Third of the Total Global Aviation Fleet Size by 2020
Bucking all odds, the Asia Pacific aerospace manufacturing market finished 2010 with record results, while most other markets were still reeling under the effects of the global economic downturn. Singapore, China, India, Australia and Japan are emerging as happy hunting grounds for aerospace manufacturers due to their low labour costs and high growth. Global original equipment manufacturers (OEMs) are increasingly seeing merit in outsourcing production to the Asia Pacific. “The global aerospace manufacturing industry is growing and facing intense competition, which is driving the industry to strategically re-align its business model to sustain long-term growth, both regionally and globally,” says the analyst of this research. “With rising cost pressures, North American and European suppliers are shifting towards lower cost regions such as Asia Pacific, South America and Eastern Europe.”
Despite the potential of the Asia Pacific, several multinational manufacturers are limiting their involvement in emerging markets in the region. The complexity of the aerospace manufacturing market, its stringent regulatory, quality and safety requirements, and low manufacturing volumes have pegged the region back to some extent. Further, the lack of an efficient supply chain, operational inefficiency and high component costs have given cause for a rethink among OEMs. Although these challenges are daunting, they can be tackled through smart acquisition and optimum work scoping. “The escalating frequency of supply chain disruption has become a major bottleneck in the aerospace manufacturing outsourcing activity,” notes the analyst. “However, the major manufacturers are expected to remedy the situation by re-evaluating their supply chains in the commercial and military segments, as they seek to gain better control of their large program pipelines.”
Manufacturing in the composites domain is likely to take centre stage in the future. The demand for better and more efficient engines, along with population growth, a burgeoning middle class and their propensity to spend will encourage aerospace manufacturing activity in the Asia Pacific. Some emerging areas in aerospace manufacturing are fleet recycling and conversion, green manufacturing as well as smart mergers and acquisitions. The long-term forecast for fleet looks extremely robust, with a compound annual growth rate (CAGR) of 3.2 per cent, which translates to 30,148 aircraft in the next ten years. All commercial OEMs have established a manufacturing base in Asia Pacific to cater to this increasing demand for fleet, resulting in high manufacturing backlogs. “The market will also experience a spurt in demand from numerous countries' decision to develop their domestic defence manufacturing base through heavy investments,” observes the analyst. “Countries expect that the internal development will go a long way in decreasing their dependence on foreign vendors.”
Market Sectors
Expert Frost & Sullivan analysts thoroughly examine the following market sectors in this research:
Aero engines
Airframes
Fuselage
Aero structures
After market
MRO
Technologies
The following technologies are covered in this research:
Composites
Propulsion systems
Green engines
Pneumatic systems
Fuel and electric power systems
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