What to Expect From the Aerospace & Aviation Industries in Coming Years — Part II


From technical developments and big data to increased mergers and acquisitions activity, the aerospace and aviation industry continues to be a hotbed for innovation.

Additionally, demand for commercial aircraft is at a near all-time high with an order backlog of more than 14,000 planes.

So, what can we expect from aerospace and aviation moving forward? As the second blog in our two-part series, we highlight a few more trends to look forward to in 2019 and beyond:

Big Data, Big Development

Big data is not only informing the way aviation businesses interact with customers, but it’s also allowing manufacturers to decrease time to market and better manage resources. Companies can now predict part failures, manage turbulence, and improve other business processes thanks to data transmitted via sensors on airplanes.

The benefits of big data continue to expand as more and more corporations utilize machine learning, algorithms, and data mining to pull out the information, analyze the results, and transform it into actionable decisions.

Right-Sizing Is Becoming a Priority

As airlines brace for a period of economic uncertainty, many are prioritizing revenue and right-sizing. Airlines now look at operating right-sized planes that are easy to fill without having to drop yields — a trend that is expected to continue.

While larger aircraft bring in more overall revenue, the revenue per available seat mile is lower as the airline often resorts to booking low-fare customers to fill additional seats. A right-sized aircraft with fewer seats might bring in 25% to 30% higher revenue per seat. By prioritizing economical, right-sized aircraft, airlines can significantly improve their bottom line.

Continued Demand for Drones

Drones are no longer just a fun quadcopter toy kids receive at Christmas. Industries from manufacturing to farming are finding new use cases for drones that help them expedite processes, often at a lower price point.

A few years ago, it was conventional to hire piloted aircraft for aerial shots of a property to map out construction sites and monitor progress. Now, construction companies can use these camera-equipped drones to accomplish these tasks. From farmers monitoring their fields to warehouses viewing their stock, the industry can expect to see continued demand for drones as more use cases are discovered.

Increased M&A Activity

As the pressure on suppliers to increase production rates and reduce costs continues, mergers and acquisitions (M&A) will remain strong. More aerospace firms are consolidating or forming partnerships to scale and better manage processes.

Additionally, smaller firms are also forming partnerships in an effort to break into the global market and compete with the bigger players. The U.S. aerospace industry contributes significantly to the domestic and global economy including hundreds of thousands of jobs — most of which come from the largest aircraft manufacturers. To gain a larger piece of the pie, smaller aerospace companies are teaming up to offer components for military and commercial aircraft, as well as specialized maintenance repair and overhaul services.

Adapting to Change

Without a doubt, one of the most significant challenges for the aerospace and aviation industry is to deliver on the order backlogs. While new technologies and innovation will bring opportunities and transformation, they will also spark additional challenges. The bottom line is that the industry must quickly learn and adapt to shifts in the economy, technology, and demand to maintain success.

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