APAC Aviation Market Size 2024-2028

The APAC aviation market size is forecast to increase by USD 423.8 billion at a CAGR of 12.48% between 2023 and 2028.  The market is experiencing significant growth, driven by the increasing demand for air travel due to rising disposable income and the convenience it offers. Additionally, airlines are focusing on enhancing operational efficiency through smart fleet management, route expansion, and the adoption of advanced technologies. However, the market is also subject to external factors such as fluctuations in oil and gas prices, which can significantly impact the profitability of commercial airlines. Despite these challenges, the aviation industry continues to innovate and adapt, with a focus on enhancing passenger experience, improving safety standards, and reducing carbon emissions. Overall, the market is expected to grow steadily, driven by these trends and the continued demand for air travel.

Market Forecasting and Size

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Market Segmentation

The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.

• Type Outlook
  • Commercial aviation
  • Military aviation
  • General aviation
• Revenue Stream Outlook
  • Passenger
  • Freight

By Type 

The commercial aviation segment is estimated to witness significant growth during the forecast period. The market is experiencing growth, particularly in the passenger traffic segment. IATA reports an increase in air passenger traffic in the region, driven by the expanding middle class and the emergence of low-cost carriers. ICAO and the Monetary Fund (IMF) forecast a continuous upward trend in passenger numbers, fueled by increasing disposable income and affordability of air travel.

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The commercial aviation segment was the largest segment and was valued at USD 218.50 billion in 2018. The market caters to various sectors, including helicopters for VIPs and charter operations, business jets, and cargo services. Newer generation aircraft with enhanced fuel efficiency and safety features are gaining popularity among commercial aviation players. The air cargo market, including freighter aircraft operators like Cargolux, is thriving due to the rise in e-commerce and the need for expedited delivery of medical supplies and other essential goods. Hence, such factors are fuelling the growth of this segment during the forecast period.

Market Dynamic

The market is experiencing significant growth, driven by increasing passenger traffic and expanding commercial aviation. The market comprises various segments, including helicopters, business jets, cargo, VIPs, rotary-wing aircraft, fixed-wing aircraft, military aviation, commercial aviation, and general aviation. Commercial helicopters and business jets cater to niche markets, while cargo and disposable medical supplies transportation are crucial for essential services. Defense spending and aircraft orders continue to fuel military aviation. New routes, aircraft deliveries, and air traffic growth contribute to the expansion of commercial aviation. Business aviation faces challenges such as high operating costs and stringent regulations. Aerial capabilities, passenger statistics, and tourist traffic are essential factors influencing market trends. International flights and air bubble arrangements are crucial for cross-border connectivity. Our researchers studied the market research and growth data for years, with 2023 as the base year along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Driver - Growing demand for aircraft

The sustainment of the year-over-year increase in air traffic forces airline operators to procure new aircraft to address the increasing demand. Therefore, major aircraft OEMs have initiated the revamping of their existing manufacturing facilities to ensure scheduled deliveries. In addition, developing countries such as India and China significantly add to the production of aircraft.

For example, India's civil aviation industry is moving from nascency towards the growth phase and progressing rapidly in aircraft manufacturing. Therefore such factors will fuel the demand for commercial aircraft in the region. Furthermore, several nations are engaged in procuring new aircraft, either through indigenous R and D or through the transfer of technologies. Hence, such factors are positively impacting the market which, in turn, drives the market during the forecast period.

Significant Market Trends - Increasing efficiency of airlines

Improved aircraft utilization is one of the reasons for enhanced energy efficiency. In addition, the average number of passengers and the average cargo weight per flight has increased, lowering energy use per useful service delivered. Furthermore, some of the infrastructures to achieve this policy are already in place.

For instance, the International Civil Aviation Organization (ICAO) has put in place policies to enhance aircraft efficiency and limit the CO2 emissions of international flights. Moreover, policy measures such as carbon pricing and even more stringent efficiency standards will increase the demand for aviation fuel in the upcoming years. Hence, such factors are positively impacting the market which in turn drives the market during the forecast period.

Major Market Challenge - Fluctuations in oil and gas prices

The factors influencing the aviation sector include crude oil and its success or failure depends on the pricing of crude oil. In addition, the volatility in crude oil prices is a major risk for airlines. Furthermore, an increase in crude oil price increases the input cost for the downstream sector, which increases the cost of aviation fuel.

Moreover, during the phase of low crude oil prices, operating costs for the aviation industry were reduced. Low aviation fuel prices have increased the profits for airlines and reduced airfares. Therefore, it is essential for airlines to maintain a balance between the low cost of aviation fuel and adding capacity to benefit from fluctuations in crude oil prices. Hence, such factors are negatively impacting the market which in turn hinders the market growth during the forecast period.

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Airbus SE: The company offers aviations such as A330 aircraft and A350 aircraft.

We also have detailed analyses of the market's competitive landscape and offer information on key companies, including:

Bombardier Inc., Commercial Aircraft Corporation of China Ltd., FACC AG, General Dynamics Corp., Groupe Industriel Marcel Dassault, Hindustan Aeronautics Ltd., Honda Motor Co. Ltd., Kawasaki Heavy Industries Ltd., Korea Aerospace Industries, Ltd., Leonardo Spa, Lockheed Martin Corp., Piper Aircraft Inc., PT Garuda Indonesia Persero Tbk, RTX Corp., Rostec, Singapore Technologies Engineering Ltd., Textron Inc., The Boeing Co., and Wanfeng Group Co. Ltd.

Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.  

Market Analyst Overview

The market is experiencing significant growth, driven by increasing passenger traffic and expanding air routes. The market comprises various segments, including helicopters, business jets, and general aviation aircraft. Helicopters are used for medical supplies and VIP transport, while business jets cater to charter operations and corporate travel. Cargo operations are a crucial segment, with freighter aircraft playing a vital role in the air cargo market.  Military customers are another significant market for aviation, with defense spending driving aircraft deliveries. Travel restrictions due to the pandemic have impacted commercial aviation, but e-commerce growth is boosting air cargo demand. Airport construction and modernization, including greenfield airports, are ongoing to accommodate increasing traffic. Military aviation also includes rotary-wing and fixed-wing aircraft. The aircraft fleet modernization trend continues, with tactical advantage and cargo operations driving aircraft orders. Freighter operators are expanding their fleets to meet the growing demand for air cargo.

Moreover, the aerospace and defense sectors are currently navigating complex challenges, including fluctuating revenue passenger kilometers (RPK) and shifts in domestic air passenger traffic. High jet fuel prices have prompted airlines to reconsider their aircraft fleets modernization strategies, impacting aircraft delivery schedules and even leading to aircraft order cancellations. In the defense arena, military spending continues to rise, with a focus on advanced capabilities like the J-20 stealth fighter aircraft and fighter jets. Nations are increasing their defense expenditure to enhance their military assets, including Light Combat Aircraft (LCA) and Light Combat Helicopters (LCH), while also exploring defense production and defense exports to boost their economies. Business aviation faces unique challenges as the market adapts to these economic conditions, influencing overall growth and operational strategies in both sectors.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2028
• Precise estimation of the market growth and trends and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Market growth and forecasting across APAC
• A thorough market analysis and report of the market's competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market  companies

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