Soaring to new heights: The rise of the global rotorcraft market
In the scope of both civil and military aviation, the global helicopter market is set to maintain the tenacious growth it has experienced over the past five years. Indeed, current forecasts suggest that by 2017 the industry will be worth an estimated $24.7 billion. Underlying the surge in demand for new rotorcraft has been the broadened appetite for helicopter use in various growth sectors of the global economy. Moreover, the replacement cycles of aging helicopter fleets are being propelled by rising levels of disposable income in emerging markets. For expanding and newly established helicopter operators, ensuring the effective long-term service of rotorcraft will require, among other factors, revised approaches to parts supply management.
Based on the forecasts of the existing Rolls Royce 10-year helicopter market outlook, a total of 16,970 turbine rotorcraft deliveries worth $140 billion are anticipated by 2020, including 10,900 for civil application and 6,070 for military use. Driving these orders are enhanced civil market fundamentals and a growing call by the world’s defence organisations for the vertical lift capability afforded by helicopters. Precisely, recent years have seen a stronger dependency on helicopters for use in offshore oil and gas operations, emergency medical services (EMS) and by law enforcement agencies. In addition, what has conventionally been an industry focused on the industrialised nations of Europe and North America has begun to undergo a shift in its customer base, with the Asia-Pacific region expected to dominate expanding sales figures over the next five years.
Chart 1: Rolls Royce turbine rotorcraft forecast
‘What we are seeing here is a budding recognition of the practical value served by helicopters. Much of this is driven by tremendous advancements in technology over the past decade, affording both reductions in operating costs and improvements to safety and overall efficiency. Indeed, these forward strides appear to be acting as a catalyst for the replacement of aging helicopter fleets worldwide, affecting both civil and military segments. In particular, China’s helicopter market, which is severely underdeveloped at the current time, is expected to see double-digit growth over the coming few years. To place it is perspective, there are roughly 300 civil rotorcraft registered in the country today, as compared to the 8,000 or so operating in Europe,’ comments the CEO of Locatory.com, Zilvinas Sadauskas.
Fuelling China’s rotorcraft market is the demand for helicopters in the country’s burgeoning offshore oil industry
Fuelling China’s rotorcraft market is the demand for helicopters in the country’s burgeoning offshore oil industry. However, the increasing practicality of helicopters in remote business engagements is being felt further afield too. For a number of years, the growth of the helicopter sector has outperformed other segments of the Australian aviation industry, with the current number of helicopters forecast to double in as little as seven years. Conducive to this growth has been the accelerating regional demand for the country’s energy and mineral reserves.
The maturing helicopter markets in emerging economies may also spell changes to the dominant players of the industry. For instance, Eurocopter has been expanding its sales, production and maintenance operations in China, reporting an upshot of 40 percent market share in the product segments for which it competes. Furthermore, last week’s highly publicised joint venture agreement between India’s Elcom Systems and Russian Helicopters to assemble Mi and Kamov brand helicopters in India is likely to shape further change to the industry dynamics of the region.
‘With the continued expansion of the rotorcraft industry comes the question of component supply. For many helicopter operators, their primary business focus has about as much to do with aviation as a racehorse has to deep sea diving. From a functional and cost-saving perspective, such circumstances would warrant an integrated component supply system in order to save time and deliver prompt solutions in AOG situations. Indeed, current e-procurement systems afford operators the opportunity to streamline their component supply process, allowing them to concentrate on more fundamental duties, such as emergency medical relief,’ comments Z. Sadauskas, CEO of Locatory.com