With the world of travel and tourism starting to pick up steam post-COVID-19 recovery, the aircraft tires market is once again pegged to record a period of notable growth in forthcoming years. Domestic and international travel and tourism were among the key revenue generators for the aviation sector, and by extension the aircraft tires industry before the start of the pandemic.
The sheer number of flights they demanded meant that aircraft maintenance activities, such as tire changes, occurred more frequently, ensuring more frequent aircraft component sales and a steady influx of capital for the market.
While the pandemic did put a halt on the industry’s momentum between 2020 and 2021, successful vaccination drives, and novel anti-covid drug discoveries have fostered the return of consumer confidence as more nations open their borders for international air traffic. Major aircraft manufacturers have already picked up on the trend and have started to act upon the new opportunities, with Airbus ramping up production, and Boeing expecting global air travel to return to pre-pandemic levels as soon as 2024.
A recent Global Market Insights Inc., report estimates that the global aircraft tires market valuation would be exceeding the $3 billion mark by 2028.
Below is a brief overview of some leading aviation industry developments that would be outlining the market growth over the forecast timeframe:
Before COVID-19, commercial aircrafts constituted a lion’s share of the daily aircraft tire maintenance and replacement numbers in the global aviation sector. Now, with global travel opening, the segment is once again set to reclaim its key revenue generator spot in the market landscape.
According to the International Air Transport Association (IATA), overall passenger numbers are expected to reach approximately 4 billion in 2024, exceeding the pre-COVID-19 levels. The United Nations World Tourism Organization (UNWTO) calculated those arrivals of global international tourists had more than doubled in January of 2022 as compared to 2021, this is an increase of over 130%. In fact, the agency reported that the 18 million additional global visitors that were recorded within the first month of 2022 were equal to the total increase in passenger numbers for the entirety of 2021.
With several world governments gradually increasing the number of permitted flights, conditions on the ground are such that airlines have been offering an array of special deals on domestic and international airfares to boost sales. This trend is helping airlines reassign more commercial airplanes to their fleets to meet demand, creating appreciable conditions conducive to the growth of the airplane tires market.
It is to be noted that a typical commercial airplane makes a maximum of 4 flights on a daily basis, and that aircraft tires are usually changed every 120-400 landings. This effectively means that a commercial jet, on average, requires a tire change every 30-100 days. With the tourism sector expected to bring the frequency of flights back to pre-pandemic levels by 2024, the commercial aircraft tires market appears to be well on its way to a strong and steady recovery.
2.Low-cost carriers to generate higher demand during recovery
For over 20 years, low-cost carriers (LCCs) have been one of the fastest-expanding segments of commercial aviation, by extension, constituting a sizable chunk of the aircraft tires market demand.
Even with fluctuations in overall air traffic, LCCs have continued to acquire a commendable share of total air passenger volumes. Consequently, each year, the LCCs, as a category, add more passengers than most airline segments, generating higher demand for aircraft MRO.
Industry projections estimate that LCC passenger growth would likely accelerate during the industry’s pandemic recovery. In fact, last year leading aircraft manufacturer, Airbus, announced plans to ramp up aircraft production, citing its estimate that the industry would recover to its pre-pandemic levels by 2025.
Most notably, the world's biggest plane-maker stated that it would raise the output of the Airbus A320neo aircraft, a highly preferred aircraft in the LCC segment, by more than 10%, going up to 45 planes per month than the previous 40 planes a month by the end 2021.
Assessing the emerging trend, it is safe to say that the LCC segment would be a major growth facilitator for the airplane tires industry through its recovery period and beyond.
3.Varying speed of regional growth
Since it is directly tied to the global aviation sector’s recovery, the airplane tires market is expected to make a strong comeback through 2028. However, the industry is expected to perform differently across different regions. While a number of countries across the globe have shown a willingness to open their borders, the actual pace at which they are implementing the change varies greatly from one another.
In the IATA’s latest press release, the organization’s Director-General stated that although the sector is moving in the right direction, the scenario of there being a uniform recovery is unlikely to occur. This effectively means that despite international flights resuming across most parts of the world, the plane tires market would be witnessing varied demands from different regions.
The Asia-Pacific has become a laggard of recovery, with New Zealand and Australia both having announced plans to connect back to the world, while China shows no signs of relaxing its strict zero-COVID strategy.
According to the IATA, the sluggish dismissal of international travel restrictions, as well as the likelihood of there being renewed domestic restrictions due to COVID waves, means that air traffic from/to/within the APAC would only hit 68% of the 2019 levels by the end of 2022, making it the weakest outcome from one of the main regions.
While the 2019 levels are expected to be recovered by 2025, demand for aircraft MRO activities such as tire maintenance and replacement would remain below the expected levels for some years.
Over the next couple of years, the intra-Europe commercial aviation market is set to benefit from passenger preferences towards short-haul flights. This would further be facilitated by the growing harmonized as well as restriction-free movement within the European Union.
Total passenger numbers from/to/within Europe is expected to hit 86% of the 2019 values by the end of 2022, making a complete recovery by 2024. This would make Europe one of the aircraft tires industry’s key revenue generators for the foreseeable period.
All in all, the growth graph of the aircraft tires industry is expected to proliferate post the pandemic slump over the next couple of years. With expansion varying across different regions, the sector would still be accumulating major gains from scaled-up aircraft production levels and the resumption of unrestricted air travel.