Avolon forecasts the fleet will almost double by 2042, growing 94% to 46,880 aircraft in its World Fleet Forecast named ‘Return to Growth’. Avolon has attributed this success to sustained growth in demand for air travel, building on the rapid recovery experienced since the pandemic.
Avolon estimates that over $4 trillion will be required to finance the 44,300 new passenger commercial aircraft to be delivered over the next 20 years, providing a considerable opportunity for lessors to partner with airlines globally to finance their growth ambitions.
Andy Cronin, CEO of Avolon, said: “Near-term production constraints will remain a feature and will reward those who have secured their orderbook pipeline. The resilience aviation has shown, and its anticipated long-term growth trend, reaffirms the investment case for aircraft as an asset class.”
The report predicts steady rise in passenger demand by c.3.5% per annum from a 2019 base, but the pace of expansion will be lower than the 5-6% of the previous 20 years due to reduced potential for further deregulation to drive growth, and higher fares because of aircraft supply shortages and increasing sustainability levies.
Jim Morrison, Chief Risk Officer of Avolon and co-author of the report, said: “Whilst the pace of growth in demand for travel will moderate, increasing GDP per capita will drive the global fleet to nearly double by 2042. Delivering on sustainability commitments is an imperative to secure aviation’s continued growth. Fleet renewal, scaling sustainable aviation fuel production, and the development of transformational new aircraft designs will be capital intensive. Lessors will play a critical role in the industry’s future success and net zero transition.”
The report focuses on new middle-class consumer to be the biggest growth driver, especially in growing markets of India, South-East Asia and Latin America and regions with biggest increase in travel out to 2042 to be India with 4.4% growth, China -3.7%, Asia 5.0% and Latin America with 4.9% growth.
The report anticipates growth of the narrowbody fleet will be 112% and will outpace widebody fleet growth at 97% as single-aisle aircraft are able to accommodate more passengers and trans-continental flight distances. Regional Jet (11%) and Turboprop (36%) growth will be more modest.
Focussing on sustainability and new technology aircraft the report predicts that global fleet will have transitioned to largely 95% new-technology fuel-efficient aircraft by the end of the forecast period. However, trillions of dollars of new investment will be required to fund the required transition to new-technology lower emissions aircraft, to ramp up the supply of sustainable aviation fuel, and to explore new designs that pioneer alternative energy sources.
Avolon claims that lessors will play a key role in accelerating fleet renewal, and a growing industry will attract the capital required to hit aviation’s net zero target by 2050.