The airline industry has been severely impacted by the COVID-19 outbreak and the ensuing lockdowns, travel bans, and other restrictions. Amid the COVID-19 crisis, the global market for Airlines estimated at US$332.6 Billion in the year 2020, is projected to reach a revised size of US$744 Billion by 2026, growing at a CAGR of 12.7% over the analysis period.
The industry has been severely impacted by the COVID-19 outbreak and the ensuing lockdowns, travel bans, and other restrictions, which have significantly impacted the business travel industry. The aerospace industry is anticipated to remain soft despite attempts to re-open the borders & economy.
Airlines are unlikely to touch the pre-crisis levels in terms of passenger traffic and overall revenues. Due to the imposition of restrictions on air travel, several airlines limited their flight schedules, adversely affecting the revenue of both airline companies and airports.
In order to reduce losses, airlines resorted to cost-cutting measures such as flight cancellations and relocation of aircraft to places with low parking charges. However, airports that have to necessarily maintain their fixed assets have seen a drastic fall in revenue from other sources such as restaurants and airport shopping due to low footfall.
Passenger Airlines, one of the segments analyzed in the report, is projected to grow at a 15.2% CAGR to reach US$587.8 Billion by the end of the analysis period. After a thorough analysis of the business implications of the pandemic and its induced economic crisis, growth in the Freight Airlines segment is readjusted to a revised 6.7% CAGR for the next 7-year period. This segment currently accounts for a 34.2% share of the global airline market.
The Airlines market in the U.S. is estimated at US$79.8 Billion in the year 2021. The country currently accounts for an 18.79% share of the global market. China, the world’s second-largest economy, is forecast to reach an estimated market size of US$142.8 Billion in the year 2026 trailing a CAGR of 15.9% through the analysis period.
Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at 9.7% and 10% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 11.7% CAGR while the Rest of the European market (as defined in the study) will reach US$148 Billion by the close of the analysis period.
Growth in the post-COVID-19 period will be led by connectivity, aircraft automation, global affluence, immersive worlds, jet propulsion advancement, fluid formats, new energy aircraft, healthy habitats, and hyper-personalization with emphasis on the future of flying. In the future, passengers are expected to tailor their experience to their needs more specifically.
The customers will be prioritizing the space requirements, entertainment, and service over buying a first or business class ticket. There will be a need to package the consumer experience differently and make significant changes to the prevailing system. Smart cabin components with integrated sensors are expected to play a decisive role in revamping the way passengers interact with the environment.
A receptive and responsible cabin adapts to the dynamic passenger`s expectations related to comfort, ambiance, intelligent seats, and activity areas. There will be continued use of technology to understand consumer behavior and preferences and implement customizations onboard in a seamless fashion. There will be the re-emergence of supersonic civilian transportation led by an exponential surge in the public & private investments in novel supersonic technologies along with an increase in the size of the space propulsion market.
Freight Sector to Reach $170.6 Billion by 2026
Cargo transport service is divided into three types depending upon the freight characteristics, express cargo, mail cargo, and other cargo.
Express cargo service is utilized by consumers for transporting perishable and time-sensitive goods and documents. Emergency supplies are transported utilizing this service. Mail cargo, as the name suggests is used for shipping mails. All the other types of cargo are shipped as other cargo. Just-in-time delivery remains the key factor for the success of the global air cargo industry. The global Freight Sector segment is estimated at US$113.6 Billion in 2020 and is projected to reach US$170.6 Billion by 2026 reflecting a compounded annual growth rate of 6.7% over the analysis period.
Europe constitutes the largest regional market for the Freight segment, accounting for 24.5% of the global sales in 2020. China is poised to register the fastest compounded annual growth rate of 8.8% over the analysis period, to reach US$26.3 Billion by the close of the analysis period.
