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1011 Makretforecast Digital 151 PDF
1011 Makretforecast Digital 151 PDF
1011 Makretforecast Digital 151 PDF
THE FUTURE
Turboprop market
forecast 2018-2037
Christian Scherer
Chief Executive Officer ATR
TABLE OF
CONTENTS
06
EXECUTIVE
SUMMARY
12
RATIONALE
16
REGIONAL
TRAVEL TRENDS
28
BENEFITS OF
REGIONAL AVIATION
38
FORECAST
BY REGION
56
FREIGHTERS
Executive Summary ExecutiveSummary
Executive Summary
CAPACITY
TRAFFIC GROWTH ROUTES CREATED BY TURBOPROPs
ACTUAL Forecast
9%
30% 6%
New 12%
25%
Routes
7%
11%
15% 16%
70%
Existing
network
Africa &
300 Middle East 200 South Asia
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
2031
2033
2035
2037
Latin America
410 & Caribbean
Central Europe,
240 Russia & CIS
440 Asia Pacific 160 Western Europe
8 9
Executive Summary ExecutiveSummary
Executive Summary
CAPACITY
TURBOPROP DEMAND TURBOPROP DEMAND by region
4,060 3,020
Growth
1,800
60%
deliveries
2,260
Replacement
1,220
40%
In service
3,020
deliveries
10 11
RATIONALE EXECUTIVE SUMMARY
RATIONALE
ASSUMPTIONS
CAPACITY METHODOLOGY
DELIVERIES
Allocated
to TP
Sources
• ATR Studies and survey
• Flightglobal
• IATA NEW Growth demand
Larger ROUTES
• OAG Capacity
• Oxford Economics
• US Department of Transportation
• US Energy Information Administration
14 15
regional travel trends regional travel trends
FUEL TRENDs upward Higher Fuel Price in Regional Airports
Forecast
x2
fuel price
1998
2001
2004
2007
2010
2013
2016
2019
2022
2025
2028
2031
2034
2037
differences
Fuel price will again be a key decision factor for airlines. Turboprop technology limits airline exposure to this
additional volatility.
18 19
regional travel trends regional travel trends
different PROPENSITies TO TRAVEL key GROWTH CONTRIBUTORS
Total seats
Regional seats /
thousand inhabitant Upsizing to larger capacity aircraft
Growth of remaining network
Route creation
2000 2037
+4.5%
1.00 TRAFFIC GROWTH
10,000 20,000 30,000 40,000 50,000 60,000
+3.0%
GDP per capita
2037
2037
+3.5%
0.10
2000 -2.0%
2000
0.01
Advanced
Emerging average
Developing
Advanced
Emerging countries in 2017
Developing 2017 2037
As middle-class and consumer spending increase in Creation of new routes will outpace upsizing to larger
many regions, the propensity to travel will develop - with aircraft, and will contribute 2/3 of total growth for the
new emerging regional markets taking the lead. next twenty years.
20 21
regional travel trends regional travel trends
ROUTE CREATION intensifies strong CONTRIBUTION FROM NEW ROUTES
Number of regional routes created Seats flown on routes created since 2002
2012-2017
China
Asia Pacific 2007-2011
excl China 2002-2006
Latin America
& Caribbean
Africa
& Middle East
Europe & CIS
North America
58%
of the current regional
21%
of current regional seats
network has been created come from routes created
in the last 15 years in the last 15 years
22 23
regional travel trends regional travel trends
New regional markets TURBOPROP: the proven optimal
are yet to emerge choice for short haul
100%
Rest of the world
World average
United States
75%
50%
330 NM
25%
Maturity
stages
0%
Regional aviation activity
Early stage Mature 100 200 300 400 500 600 700
per inhabitants
(NM)
Blank: no data
Leveraging turboprop advantages (cost efficiency, access There is a substantial fleet of legacy regional jets in
to challenging airfields), these countries will contribute the United States leading to the contrast between this
to the bulk of market growth while developing the country and other regions.
economies of secondary and tertiary cities.
24 25
regional travel trends
regional travel trends
Turboprops: the way to reduce
TURBOPROPs ARE MORE SILENT
regional aviation emissions
TP Similar size RJ
tonnes
11%
Chapter 3 limit
(1978)
Up to of
876,000 overall regional aviation -10dB
emissions saved
Chapter 4 limit
Current generation (2006)
regional jets
-7dB
1,095,000 Chapter 14 limit
9dB margin (2020)
Future regional
jets (EIS 2021)
1,168,000
CO2 annual savings by replacing
jets on routes up to…
400-500 NM Today’s environment noise regulations are getting more
300-400 NM and more stringent.
949,000
200-300 NM With their remarkably low noise signature, turboprop
Up to 200 NM aircraft are the benchmark with a strong margin to 2020s’
ICAO standards.
26 27
benefits of regional aviation
benefits of regional aviation Executive Summary
CONNECTING LOCAL COMMUNITIES AIR CONNECTIVITY SUPPORTS
CAPACITY LOCAL DEVELOPMENT
50%
Airports relying
More More
Social Development Employment
exclusively on
regional aircraft
3,800+
commercial
airports
Furthermore they ensure accessibility to all airfield Either through tourism development or by establishing
profiles and are the lifeline of many communities. business, interlinking secondary and tertiary cities allows
every community to be connected and benefit from
world economic growth – a key component of sustainable
development.
30 31
benefits of regional aviation benefits of regional aviation
Executive Summary
Turboprops complement VALUABLE TIME SAVING OF
CAPACITY
ground transportation AIR CONNECTIVITY
Different solutions for different schemes Average time benefit of air vs ground
transport
From surface ... ... to air transport
Manila Manila
1h30
1h30
10h
Kalibo
Kalibo
11h30 1h30
Paris Paris
Blank: no data
Turboprops provide a valuable travel solution which Depending on ground infrastructure and/or geographical
qualitatively complements any alternative mode of constraint, the time saved flying regionally is highly
ground transportation. valuable to travellers.
Not only turboprops provide travelers accustomed to Moreover, regional air transport is a quick enabler of
slower modes of ground transportation with the comfort economic development as it requires shorter lead-time
and convenience of extra speed, but they also maintain to implement connectivity.
essential air connectivity on previously dense routes
where flows have reached levels that allow high speed
trains to ‘dry out’ air traffic.
32 33
benefits of regional aviation
Executive Summary
benefits of regional aviation
Lower competition on
CAPACITY FIRST MOVER ADVANTAGE
regional routes
Average
number
of carriers
+3%
Trunk routes
-38%
Regional routes
-44%
Route
opening 1 operator* 2 operators 3+ operators
20 140 260 380 500 620 740 860 980
Seats flown
daily each way *
after one year since route opening
Emerging markets
World average
Europe
North America
Regional networks tend to be operated by fewer carriers Opening a route offers a dominant competitive position
than routes with larger traffic volume. that eventually leads to a higher yield when the route is
mature. However, the entry of new competitors has an
This “blue ocean” provides a wealth of opportunities to adverse effect on total revenues.
get away from the cash-intensive competition on main
routes Turboprops, as typical first movers, offer higher rewards
for exploring new routes and developing regional
networks.
34 35
benefits of regional aviation benefits of regional aviation
Executive Summary
AFTER ROUTE OPENING: Advantages of high frequencies
DIFFERENT GROWTHCAPACITY
PROFILES with turboprops
High (8%)
Medium (11%)
Weekly
Intermediate (20%) Flexibility
flights Low to Intermediate (26%)
Low (30%) Higher yield
56
Protect
the market
49
High frequency Low frequency
42
Small module Large module
Growth potential
35
28
21
14
Operating high frequencies with turboprops offers a
competitive advantage to airlines:
7
• Adapt to peaks of demand with a flexible offer and
strategic utilisation of slots
0
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 • More choices for business passengers, which allows
20% higher yield than low frequencies
• Protect the market by blocking the entry of new
operators.
There are various patterns of new route development,
ranging from fast growing routes likely to welcome
single-aisle capacity within a few years, to flows whose
growth is capped due to more limited traffic potential.
36 37
FORECAST by region Executive Summary
FOCUS ON Africa & Middle East
CAPACITY
Turboprop 70
Turboprop 50
260
90
350
DELIVERIES
40 41
FORECAST by region Executive Summary
FOCUS ON North America
CAPACITY
Turboprop 70
Turboprop 50
240
110
350
DELIVERIES
With many inefficient 50-seater jets left over from the 90s
555 and the subsequent average capacity growth, US regional
aviation has failed to maintain many air links. Modern
430 turboprops can restore connectivity by replacing ageing
30-50-seaters and providing an efficient alternative to a
5-6 hour drive.
42 43
FORECAST by region Executive Summary
FOCUS ON Latin America & CAPACITY
Caribbean
Turboprop 70
Turboprop 50
350
70
420
DELIVERIES
Essential for the tourism and socio-economic
development of the Caribbean, turboprops will remain
2017 2037 the island hopper benchmark for sustainable air links.
44 45
FORECAST BY REGION EXECUTIVE SUMMARY
FOCUS ON ASIA PACIFIC
CAPACITY
TURBOPROP 70
600
TURBOPROP 50
140
740
DELIVERIES
1015
TURBOPROPS IN SERVICE
590
Route creation will accelerate and drive growth,
especially in South East Asia, where air connections will
offer a faster and more efficient choice to travelers.
Turboprop 70
Turboprop 50
220
40
260
DELIVERIES
48 49
FORECAST by region Executive Summary
FOCUSCAPACITY
ON China
Turboprop 70
Turboprop 50
230
70
300
DELIVERIES
50 51
FORECAST by region
FOCUS ON Central Europe, Russia & CIS
CAPACITY
Turboprop 70
Turboprop 50
190
60
250
DELIVERIES
52 53
FORECAST by region Executive Summary
FOCUS ON WESTERN EUROPE
Turboprop 70
Turboprop 50 300
50
350
DELIVERIES
525
TURBOPROPs in service
54 55
FREIGHTERS
FREIGHTERS
Executive Summary
Significant untapped opportunities
CAPACITY E-commerce continues to grow
in emerging markets
x2
37%
41%
9% 6%
7%
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
2031
2033
2035
2037
Emerging & Developing
78% Advanced
58 59
FREIGHTERS FREIGHTERS
Executive Summary
upsizing capacity
CAPACITY Turboprop freighter demand
Up-gauge to
122
5t capacity
TP 5t
Limited
feedstock 87
Up-gauge to
8t capacity
124
TP 8t
Ample 40
feedstock
2017 2037
460
Freighter
deliveries
The air cargo market is highly price sensitive and Growing world trade together with the emergence of
operators constantly seek the best economics. This new markets will result in a 3.2% annual growth over the
explains the clear market preference for turboprops, next 20 years. This growth will translate into an increase in
which represent 96% of the regional freighter fleet. overall fleet size and upsizing of current aircraft gauge.
The evolution of the turboprop freighter fleet will be The 8-tonne segment will become the reference point
determined by feedstock availability and market needs. for the market while 3-5 tonne capacities will significantly
reduce due to a lack of feedstock.
60 61
SAFE HARBOUR STATEMENT
Disclaimer
This presentation includes forward-looking statements. Words
such as anticipates, believes, estimates, expects, intends,
plans, projects, may, forecast and similar expressions are used
to identify these forward-looking statements. Examples of
forward-looking statements include statements made about
strategy, rampup and delivery schedules, introduction of new
products and services and market expectations, as well as
statements regarding future performance and outlook.
By their nature, forward-looking statements involve risk
and uncertainty because they relate to future events and
circumstances and there are many factors that could cause
actual results and developments to differ materially from those
expressed or implied by these forward-looking statements.
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