Daily Memo: Aviation Week Fleet Forecast Sees More Aircraft, More Emissions

When airlines were looking ahead to what 2023 could be like, the big theme was that it would be the first normal year—not affected by coronavirus pandemic lockdowns and fleet groundings. 

While there were no lockdowns keeping people from traveling, 2023 turned out to be far from routine, and the fallout of events is going to affect airlines and OEMs for at least some years. Supply chain constraints continue to hold back production ramp-up and necessary engine repairs traced back to production flaws will have a serious impact on at least the Airbus A320neo family through 2026. Managing the unexpected therefore continues to be a key skill needed for senior executives in the industry.

Nonetheless, the latest edition of the Aviation Week Network forecast for commercial aviation, which is published Oct. 11, sees the industry continuing on its growth path. Over the next 10 years, the commercial aircraft fleet is going to see a compound annual growth rate (CAGR) of 3.3%. In the 2024-33 period, 22,120 new aircraft are going to be delivered and as 11,600 are going to be retired (with some of them going into passenger-to-freighter conversion and therefore staying), the fleet will grow by 12,500 units. For perspective: Aviation Week Network projects an active commercial aircraft fleet of more than 32,000 by the end of this year. Interestingly, this is up from 25,000 at the lowest point of the pandemic in 2020.

For the first time, Aviation Week Network is also releasing its own forecast on emissions. According to the projections and based on current policy frameworks and technological evolution, emissions from aviation will continue to grow through the early 2030s. While there are efficiency improvements mainly through the use of new engines and more efficient (widebody) aircraft, these are overcompensated by the fast growth of the sector, exposing the industry to increased criticism and potentially more political action around its environmental performance.

The forecast predicts a 4.5% annual increase in total CO2 emissions, higher than the predicted fleet growth. While that may seem counterintuitive given that older aircraft are replaced by new ones, there are concrete reasons for it: airlines continue to upgauge their average aircraft size, and these larger aircraft burn more fuel per trip. Also, utilization is expected to go up. Despite the issues affecting mainly the Pratt & Whitney powered part of the narrowbody fleet, over time the aircraft delivered now are going to be used more than those they are replacing, partly as narrowbodies such as the A321XLR will be flying new long-haul routes too thin for widebodies.

The upgauging does have a positive effect on per seat CO2 emissions, which will decline by 6.3% annually. It is also shown in the predictions for seat availability: airlines will grow capacity as measured in seats by 4.7% annually, almost 1.5 times as fast as their fleet growth in aircraft units.

The numbers also reflect Airbus’ success in the narrowbody market, which Aviation Week Network expects to continue in the next 10 years. The Airbus A320 fleet will outnumber the Boeing 737 by more than 1,500 aircraft by 2033. And there are still substantial risks on the Boeing side, particularly for the certification timeline of the 737-7 and -10.

Already for many years a marked shift favoring narrowbodies has been observed. LCCs have been growing faster than their legacy peers—their fleets are typically made up of single-aisle aircraft and slowly but surely more narrowbodies are being deployed into markets previously exclusive to widebodies as a function of their range capabilities. That trend is to continue and accelerate. Airbus plans to deliver the first A321XLR by the middle of next year—it has more than 550 orders for the type alone.

Given the current fleet age and issues such as the PW1100G production quality and durability shortfalls, retirements will stay low for a number of years. But they will pick up in 2027 and 2028. Then, more than 3% of the in-service fleet will be retired every year, a historical high.

While the overall story of commercial aviation is about growth, there are sub-sectors that are actually no longer growing. The regional jet fleet is expected to contract by 1.2% annually over the next 10 years. Most OEMs have left the market and fleets are beginning to age. Not all of the aircraft are replaced by regional jets; upgauging to narrowbodies is also continuing as LCCs are entering even more markets that would have been the domain of regional airlines in the past and hub feeding is also transitioning to larger aircraft. For the time being, Embraer remains the only regional jet manufacturer.

The trend is even more distinct in the turboprop field where the in-service fleet will shrink by 3.3% annually. ATR will dominate the market. There are a number of new entrants lined up using hybrid-electric or hydrogen propulsion, but their market shares will still be small during the forecast period.

Learn more about Aviation Week Network's forecasts here: AviationWeek.com/FleetForecast