The Europe aircraft avionics market is projected to grow with a CAGR of more than 4% during the forecast period.
- The development and integration of advanced avionic suites onboard aircraft (both linefit and retrofit) are expected to accelerate the growth of the avionics market in the Europe region. The planned orders and deliveries of commercial aircraft of major airlines in the Europe region during the forecast period to cater to the increasing passenger traffic is expected to generate demand for avionics in the region. Also, the demand for military aircraft as well as private aviation in the region is expected to bolster the growth of the market.
- Due to the COVID-19 pandemic, the aircraft OEMs have decreased their aircraft production and airlines are postponing their expansion plans, which will affect the revenues of the Tier-I companies of the aerospace sector in 2020 and years to come.
Key Market Trends
The Commercial Aircraft Segment is Expected Witness Highest Growth During the Forecast Period
The commercial aircraft segment of the market is expected to witness the highest growth during the forecast period due to increasing aircraft orders in the region to cater to the growing passenger traffic in the region. Major airlines in the region like Lufthansa, Air France-KLM, Aeroflot, and Swiss International Airlines among others have aircraft on orders as a part of their fleet expansion plans. In March 2019, the Lufthansa Group announced the order of 20 Boeing 787-9 and 20 additional Airbus A350-900 planes, which are expected to replace the existing four-engine aircraft fleet. The new aircraft deliveries are scheduled between late 2022 and 2027. Similarly, as a part of Air France-KLM airline’s fleet rationalization and simplification strategy, Air France plans to maintain a long-haul fleet of 116 aircraft by 2023, with only four aircraft families, namely A330s, A350s, B787s, and 777s. Such robust plans of the airlines to expand their fleet of aircraft in operation is anticipated to bolster the growth of the market during the forecast period.
The United Kingdom Dominates the Market in terms of Market Share
The United Kingdom currently dominates the market and is expected to continue its dominance during the forecast period. This is mainly due to the fleet expansion and route expansion plans of the airlines like Virgin Atlantic Airways, easyJet, Jet2.com, and British Airways among others operating in the country. easyJet signed an agreement with Airbus in November 2019, for the purchase of 12 A320NEOs. As of July 2020, the airline had 111 aircraft on orders. Later in April 2020, the airline announced to postpone the delivery of 24 Airbus aircraft, due to the impending financial crisis because of COVID-19. The declining passenger traffic, as well as flight movements in the country due to COVID-19, are the factors affecting the aircraft deliveries, which in turn, is expected to affect the market of commercial aircraft avionics in the future.
The increased military spending of the country is propelling the procurement of new generation aircraft that will enhance the air capabilities. Currently, the United Kingdom has a fleet of 17 F-35 and has 18 more aircraft on order. By 2022, the country plans to have a fleet of 35 F-35B aircraft. In total, the country has committed to acquire 138 F-35 joint strike fighters (JSFs) over the program's lifetime. Such aircraft orders are expected to drive the military aircraft avionics market.
Some of the prominent players in the Europe aircraft avionics market are Safran SA, Cobham plc, LATECOERE S.A, L3Harris Technologies Inc, and Raytheon Technologies Corporation. Raytheon Technologies Corporation’s subsidiary Collins Aerospace is the major avionics provider to major aircraft programs of commercial, military, and general aviation segments for aircraft OEMs like Airbus and Boeing. As the major players in the market sign long-term contracts with the aircraft OEMs, which makes it difficult for new players to enter the linefit segment of the market. However, the other global and regional players that provide connectivity solutions, gauges and indicators, GPS, jammers, and other control systems for various flight activities occupy a significant part of the retrofit segment of the market.
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