Global commercial aircraft sector grew 8.9 percent in 2013; record production expected to continue, says Deloitte

NEW YORK, 15 April 2014. Global commercial aircraft manufacturers grew their revenues by 8.9 percent in 2013, according to information from 100 global aerospace companies, Deloitte analysts say.

Apr 15th, 2014
Global commercial aircraft sector grew 8.9 percent in 2013; record production expected to continue, says Deloitte
Global commercial aircraft sector grew 8.9 percent in 2013; record production expected to continue, says Deloitte

NEW YORK, 15 April 2014. Global commercial aircraft manufacturers grew their revenues by 8.9 percent in 2013, according to information from 100 global aerospace companies, Deloitte analysts say.

Key industrial metrics include: production output of 1,274 aircraft, net sales of 2,858 orders, a backlog of nearly eight years of production, and revenues totaling nearly $105 billion—all factors contributing to the sector's record performance. Primary drivers of new commercial aircraft requirements include increased travel demand, especially in the Middle East, India, and China, as well as replacement of obsolete aircraft with new fuel-efficient models.

The analysis found that aircraft production levels in 2013 were 31 percent higher than 2010 and were more than twice the production levels experienced 10 years ago.

"Absent a global recession, the record levels of commercial aircraft production are expected to continue, with announced rate increases and new model introductions over the next several years," says Tom Captain, vice chairman, Deloitte LLP and U.S. and Global Aerospace and Defense (A&D) leader.

Profitability increased 16.3 percent in 2013, as manufacturers implemented efficiencies in pricing, internal processes, supplier management and program management. The analysis found that European commercial aircraft producers improved profits by 26.9 percent, although operating margins of 3.5 percent remained well below the operating margins among North American manufacturers of 8.2 percent.

"The key challenge for the commercial aircraft manufacturers is to de-risk the supply chain by helping suppliers address the capacity and capability requirements of increased rates of production, while lowering overall costs," Captain adds.

Deloitte staff analyzed the financial performance of 100 major global and U.S. aerospace and defense companies in 2013. The key financial indicators analyzed include sales revenue, operating earnings and operating margins, obtained through company filings and press releases.

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