Aerospace & Defense key figures 2015
The Aerospace & Defense activity sector
The aerospace industry and economy follow the same pattern as world GDP. The long term forecast and uncertainties of the worldwide economy are thus a key input for the analysis of this sector. It should be noted that the number of employees in Aerospace and defense companies is increasing constantly. It represents 2 millions of employees in Europe, USA and China, the biggest aeronautics’ areas. This activity sector is driven by mergers and acquisitions (5452 mergers and acquisitions between 1988 and 2010) and investments in R&D (private and governmental). Companies in the aerospace & defense sector are giants in term of turnover and are generally diversified in different activities (commercial aircraft, space, defense products). So the number of companies is very concentrated in this activity sector. The sector can be monitored with a focus on three sub-groups :
1. Airplane manufacturers :
Global Gross Domestic Product is projected to grow 3.5 % per year for the next 10 years, driving world traffic growth of 4.7%. Thus, this indicator has an impact on aircraft orders. Concerning demand for passenger, Asia and Middle East should have the biggest growth. 2015 reached a record in terms of production rates. The global production level has been above 1 000 aircrafts per year since 2010 and is expected to reach about 1500 aircrafts per annum during the next 20 years..
2. Launch vehicle and satellite manufacturers :
Telecommunication and observation satellite orders should remain stable at about 20 and 15 per year respectively. The demand will principally come from Asia and Africa. Major aerospace nations are Europe, USA, Russia and China, which all have famous launchers (Ariane, Delta, Falcon, Proton, Long March…).
3. Defense products manufacturers :
Global spending with defense contractors declined in 2015, due to government budgetary reductions in the US, UK and the rest of Europe but the recent geopolitical environment should reverse this position. As always, the US still have the biggest worldwide defense budget and from 2002 to 2015, their budget increased by about 65%. China, Russia, India, Saudi Arabia, the United Arab Emirates and Brazil have all increased their military expenditure over the last 10 years.