Global Commercial Aerospace Digital Solutions Growth Opportunities

Global Commercial Aerospace Digital Solutions Growth Opportunities

Data-centric Next-generation Technologies to Enhance the Future Growth Potential of Commercial Aerospace

RELEASE DATE
23-Sep-2021
REGION
Global
Deliverable Type
Market Research
Research Code: PC04-01-00-00-00
SKU: AE01500-GL-MT_25808
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Description

Digitalization is a ubiquitous strategy essential to sustain business and growth in a post-pandemic economy. High penetration and improvement of digital solutions and accompanying hardware have made digitalization affordable and customizable. The commercial aerospace digital solutions market is captured by identifying digital R&D investment and the annual digital expenditure for each stakeholder. Digital investment is broadly considered a part of Information Technology (IT) investment, except for a few major industry stakeholders that have dedicated digital investment and teams for implementing and monitoring progress. Digitalization covers the investments and efforts by a firm to move toward digital processes, reduce cost overheads, and identify new revenue streams. Investments in mobile solutions, cloud computing, the Internet of Things, and Artificial Intelligence are some of the major focus areas for digitalization.

The study is segmented into 4 key commercial aviation segments: airlines; airports; maintenance, repair, and overhaul (MRO); and original equipment manufacturer (OEM).

Growth factors were identified for each airline type. The parameters for full-service carriers were economic strength (in terms of GDP percentage growth) and levels of passenger traffic and tourism; for low-cost carriers, levels of domestic passenger traffic and smartphone/internet penetration; and for cargo carriers, the level of international freight movement.

As the COVID-19 pandemic severely affected airports’ spending capacity in 2020, digital investments will be allocated to high-priority projects alone; this will have an impact on the overall airport IT budget requirements amidst the drastic drop in overall passenger traffic. Therefore, airports will adopt a cautious approach over the short term (2021–2023) until passenger traffic reaches the 2019 pre-pandemic level (probably during 2024–2025). The budget for digital investments largely depends on the overall passenger traffic at airports and the financial digital investment capability of airports. Airports with high passenger traffic (e.g., airports in APAC) and high spending capacity (e.g., Tier I airports) will be able to negate the lower revenue achieved during the 2020–2023 time period.

MRO participants, with their B2B business model, are largely behind in terms of digitalization (only 6%), when compared to the other aviation stakeholders. Social distancing norms and the subsequent limited number of onsite technicians restrained growth for the overall market, but these factors contributed to an increase in digitalization projects in MROs.

The OEM segment not only offers digital solutions to other segments but also actively invests in acquiring and developing full-stack digital capabilities (e.g., Boeing’s AnalytX platform). Most of the digital initiatives were managed by in-house teams, with only specific projects being outsourced. OEMs are leveraging digital solutions to improve their throughput, quality, and workforce efficiency—the top driving factors for the forecast period. Supply chain vulnerabilities stemming from the COVID-19 pandemic, challenges in data sharing, and cross-border integration requirements are top challenges that were considered while forecasting the OEM segment.

For the short term (2021–2023), the market will grow at high rates as aviation recovers (to pre-pandemic levels) by meeting pent-up demand, the growing requirement to maintain parked aircraft, and top OEMs managing their growing backlogs and orders; these factors will increase digital investment in efficient operations in both the airline and airport segments. Digital investment in the airline segment will be assigned toward revamped revenue and demand management solutions; in the airport segment, toward self-service technology and passenger flow management; and in the MRO segment, toward mobile solutions.

RESEARCH: INFOGRAPHIC

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Table of Contents

Why is it Increasingly Difficult to Grow?

The Strategic Imperative 8™

The Impact of the Top Three Strategic Imperatives on Commercial Aerospace Digital Solutions

Growth Opportunities Fuel the Growth Pipeline Engine™

What You Need to Know First

Trends You Need to Know

Trends You Need to Know (continued)

Scope of Analysis

Segmentation

Commercial Aerospace Value Chain

Key Competitors

Key Growth Metrics

Growth Drivers

Growth Restraints

Forecast Assumptions

Revenue Forecast

Revenue Forecast by Industry Vertical

Revenue Forecast by Region

Revenue Forecast Analysis

Revenue Forecast Analysis by Region

Revenue Forecast Analysis by Industry Vertical

Pricing Trends and Forecast Analysis

Competitive Environment

Revenue Share

Revenue Share Analysis

Airline—Key Solution Providers

Airport—Key Solution Providers

Airline—Notable Start-ups

Airports—Notable Start-ups

Aerospace OEM—Notable Start-ups

MRO—Notable Start-ups

Recent Key Mergers & Acquisitions

Impact of the COVID-19 Pandemic on Airlines

Impact of the COVID-19 Pandemic on Airline Digitalization

The COVID-19 Spotlight on Cargo Airlines

Airline Data Value Chain

Airline Data Value Chain & Digital Challenges

Impact of the COVID-19 Pandemic on Airports

Impact of the Pandemic on Airport Digitalization

Airport Data Value Chain

Key Metrics for Airport Digitalization

Impact of the COVID-19 Pandemic on OEMs

Key Aerospace OEM Trends

Aerospace OEM Digital Solutions & Challenges

Digital Focus of Aerospace OEM Digitalization

Impact of the COVID-19 Pandemic on MROs

Impact of the COVID-19 Pandemic on MRO Digitalization

Aircraft Data & MRO—Digital Value Chain

Analytics Platforms

Analytics Platforms (continued)

Sustainable Aviation in Focus

Sustainable Aviation in Focus (continued)

Key Growth Metrics for Airlines

Revenue Forecast

Revenue Forecast by Region

Forecast Analysis

Key Growth Metrics for Airports

Revenue Forecast

Revenue Forecast by Region

Forecast Analysis

Key Growth Metrics for OEM

Revenue Forecast

Revenue Forecast by Region

Forecast Analysis

Key Growth Metrics for MRO

Revenue Forecast

Revenue Forecast by Region

Forecast Analysis

Growth Opportunity 1: Disruption Management and Fuel Optimization for Improved Operational Efficiency—Airlines

Growth Opportunity 1: Disruption Management and Fuel Optimization for Improved Operational Efficiency—Airlines (continued)

Growth Opportunity 2: Big Data Platforms for Improved Operations and Merchandising

Growth Opportunity 2: Big Data Platforms for Improved Operations and Merchandising (continued)

Growth Opportunity 3: Cybersecurity for Improved Operational Resilience

Growth Opportunity 3: Cybersecurity for Improved Operational Resilience (continued)

Growth Opportunity 4: Predictive Analytics for Higher Maintenance Efficiency

Growth Opportunity 4: Predictive Analytics for Higher Maintenance Efficiency (continued)

Growth Opportunity 5: Total Airport Management for Optimal Efficiencies

Growth Opportunity 5: Total Airport Management for Optimal Efficiencies (continued)

Growth Opportunity 6: Improved Automation and Digital Design for Greater Digital Integrity

Growth Opportunity 6: Improved Automation and Digital Design for Greater Digital Integrity (continued)

Your Next Steps

Why Frost, Why Now?

List of Exhibits

List of Exhibits (continued)

List of Exhibits (continued)

Legal Disclaimer

Digitalization is a ubiquitous strategy essential to sustain business and growth in a post-pandemic economy. High penetration and improvement of digital solutions and accompanying hardware have made digitalization affordable and customizable. The commercial aerospace digital solutions market is captured by identifying digital R&D investment and the annual digital expenditure for each stakeholder. Digital investment is broadly considered a part of Information Technology (IT) investment, except for a few major industry stakeholders that have dedicated digital investment and teams for implementing and monitoring progress. Digitalization covers the investments and efforts by a firm to move toward digital processes, reduce cost overheads, and identify new revenue streams. Investments in mobile solutions, cloud computing, the Internet of Things, and Artificial Intelligence are some of the major focus areas for digitalization. The study is segmented into 4 key commercial aviation segments: airlines; airports; maintenance, repair, and overhaul (MRO); and original equipment manufacturer (OEM). Growth factors were identified for each airline type. The parameters for full-service carriers were economic strength (in terms of GDP percentage growth) and levels of passenger traffic and tourism; for low-cost carriers, levels of domestic passenger traffic and smartphone/internet penetration; and for cargo carriers, the level of international freight movement. As the COVID-19 pandemic severely affected airports’ spending capacity in 2020, digital investments will be allocated to high-priority projects alone; this will have an impact on the overall airport IT budget requirements amidst the drastic drop in overall passenger traffic. Therefore, airports will adopt a cautious approach over the short term (2021–2023) until passenger traffic reaches the 2019 pre-pandemic level (probably during 2024–2025). The budget for digital investments largely depends on the overall passenger traffic at airports and the financial digital investment capability of airports. Airports with high passenger traffic (e.g., airports in APAC) and high spending capacity (e.g., Tier I airports) will be able to negate the lower revenue achieved during the 2020–2023 time period. MRO participants, with their B2B business model, are largely behind in terms of digitalization (only 6%), when compared to the other aviation stakeholders. Social distancing norms and the subsequent limited number of onsite technicians restrained growth for the overall market, but these factors contributed to an increase in digitalization projects in MROs. The OEM segment not only offers digital solutions to other segments but also actively invests in acquiring and developing full-stack digital capabilities (e.g., Boeing’s AnalytX platform). Most of the digital initiatives were managed by in-house teams, with only specific projects being outsourced. OEMs are leveraging digital solutions to improve their throughput, quality, and workforce efficiency—the top driving factors for the forecast period. Supply chain vulnerabilities stemming from the COVID-19 pandemic, challenges in data sharing, and cross-border integration requirements are top challenges that were considered while forecasting the OEM segment. For the short term (2021–2023), the market will grow at high rates as aviation recovers (to pre-pandemic levels) by meeting pent-up demand, the growing requirement to maintain parked aircraft, and top OEMs managing their growing backlogs and orders; these factors will increase digital investment in efficient operations in both the airline and airport segments. Digital investment in the airline segment will be assigned toward revamped revenue and demand management solutions; in the airport segment, toward self-service technology and passenger flow management; and in the MRO segment, toward mobile solutions.
More Information
Deliverable Type Market Research
No Index No
Podcast No
Author Abhilash Varkey Abraham
Industries Aerospace, Defence and Security
WIP Number PC04-01-00-00-00
Is Prebook No
GPS Codes 9000-A1