Market Challenges And Opportunities

Global Aircraft Refurbishing Market- Drivers

Growing appeal of premium economy class

Premium economy class has been popular among travellers as it offers significant upgrade over regular economy class without high price of business class fare. Premium economy class is preferred by passengers as it offers more space and comfort, premium meals with complementary bar service, and priority check-in and baggage delivery at the airport. For instance, Qatar Airways, a renowned airline based in Qatar, offers a premium economy class on select long-haul routes. From 2020 onwards, they started introducing their new premium economy cabin, which provides passengers with additional space and comfort compared to regular economy class. Thus, it is expected to drive the market growth in the near future. Furthermore, major airlines around the world are introducing premium class section in their aircrafts for their customers. This, in turn, is expected to offer lucrative opportunities for refurbishment service providers to increase number of premium economy class seats for travellers.

Increasing demand for VIP refurbishment of aircrafts

Asia Pacific, followed by North America is home to the largest population of high net worth individuals. This has supported growth of aerospace aftermarket albeit it is niche. Significant growth of this make has increased the demand for refurbishment and completion of cabin interiors of business and corporate jets. Moreover, VIP refurbishment is one of the most profitable businesses as the price for complete services including manufacturing, engineering, interior design, installation, and certification of custom interiors comes out to be really high. VIP cabins are comprised of lounge area, bedroom, first-class seats, and dining room. This, in turn, is expected to boost the market growth over the forecast period.

Global Aircraft Refurbishing Market- Opportunities

High growth in conversion into freighter from passenger aircrafts

Companies that are in cargo shipping business are looking for refurbished passenger aircrafts as they cost around one-third of a freighter aircraft. A P2F conversion extends the aircraft’s lifespan. Through this conversion, the companies transition airplanes into freighters, expanding economic life of the airplane after the useful operational service. Furthermore, any type of passenger plane can be converted into freighter, which extends its scope of this segment of the global aircraft refurbishing market.

Development of advanced technologies

In-flight entertainment system components are integrated and repackaged consumer electronics. As these electronic components have small lifespan, aircraft refurbishing becomes extremely essential, in order to stay ahead and avoid obsolescence. Moreover, these technologies get outdated very quickly, key players have the opportunity to design, manufacture, and install customized inflight entertainment system and keep pace with new technological innovations. This, in turn, is expected to pose conducive business opportunities for market players in the near future.

Growing appeal of premium economy class
Increasing demand for VIP refurbishment of aircrafts

Restraints & Challenges:

Advent of next-generation aircrafts with low maintenance
Strict regulatory policies

Global Aircraft Refurbishing Market- Restraints

Advent of next-generation aircrafts

Next-generation aircrafts are manufactured with advanced avionics, engines, and systems, which makes them more efficient, mission capable, cost-effective, and comfortable for consumers. For instance, enhanced-vision system allows landing in rogue weather while advanced cabin pressurization system reduces the fatigue of flying. Moreover, advanced engine provides improved fuel efficiency. These factors encourage buyers to go for next-generation aircraft rather than refurbished old aircraft, which in turn, is expected to restrain the market growth. Furthermore, new aircraft comes with warranty for avionics, engines, airframe, and interiors for the span of five years, which compel buyers to rather go for next-generation aircraft.

Strict regulatory policies

Many countries have laid down stringent regulatory policies related to noise and air pollution, in order to reduce greenhouse gas effects. This will lead to decline in aircraft refurbishing significantly and will compel owners to decommission their aircrafts and buy new ones. Moreover, aircraft with older technology engines exert larger greenhouse gas effect due to engine deterioration. Exercise of penalties for exceeding local emissions limits may further encourage airline owners to choose new aircrafts with lower nitric oxide emission. Therefore, these factors are expected to hamper the growth in the near future.