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The global avionics market size was valued at USD 48.00 billion in 2019 and is projected to reach USD 75.81 billion by 2027, exhibiting a CAGR of 9.25% during the forecast period.
Avionics are technologically advanced electronic systems that are used in spacecraft, artificial satellites, and aircraft. The aircraft flight computer system is a combination of multiple display units which are equipped in the aircraft to perform the flight operation. Avionic systems include automatic flight management systems (AFMS), communication, navigation, surveillance (CNS), and the management of several operational modes.
Aviation Industry is Facing Unprecedented Challenges due to the COVID-19 Pandemic
According to the World Bank Organization, in 2019, around 4.6 billion air-passengers were carried around all over the world. The aviation industry growth is based on low-fare airlines, new travel trends, growing economies, and the replacement of conventional aircraft. The COVID-19 pandemic that initiated in December 2019 from Wuhan city, China, has had a drastic impact on several economies across the world. The rapid spread of coronavirus had a major impact on the global aviation industry.
Several European countries were enforcing national lockdowns since January 2020. In June 2020, Japan announced that it would postpone the Olympic game to 2021 due to the COVID-19 pandemic. The commercial aviation industry is facing major challenges due to the coronavirus effect, such as the declining graph of air passenger traffic. The International Air Transport Association (IATA) released the report of global passenger traffic data 2020, and the report exhibits the 14.1% fall in the revenue generated from air-passenger traveling compared to the financial year 2019.
According to a Bloomberg 2020 report, the U.S. aerospace industry has lost USD 200 billion market value. Teal Group stated that the Boeing Company did not have a single order in January 2020. The Boeing deliveries have been hampered by the issues associated with the 737 MAX orders, whereas Airbus S.A.S. has been registered for zero orders in February 2020. Avionics is a prime system of an aircraft; there has been a direct impact on the market as demand for commercial aircraft is decreasing from the financial year 2020.
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The Transition towards Next-Generation Integrated Avionics System to Drive the Market Growth
The integrated avionics is reducing the electronic control unit cost and also improving aircraft performance. The product is a combination of automatic dependent surveillance-broadcast (ADS-B), next-generation data communications, next-generation network-enabled weather (NNEW), and system-wide information management (SWIM). The integrated product is improving the air traffic management, communication, and situational awareness capability of the aircraft.
Improving Aircraft Computing Capabilities are Propelling the Market Growth
Aircraft computer systems are providing proline fusion capabilities, integrated cabin electronics solutions, communications systems, navigation systems, surveillance systems, integrated flight controls, and simulation and training systems. All these systems are improving the operational performance of aircraft. The proline fusion capabilities are the combination of flight guidance & information management, touch control of primary flight displays, and advanced flight and performance management. In the integrated cabin electronics solutions, including wireless connectivity equipment, airshow moving maps, and advanced cabin management systems along with touch-screen controls. Communications systems are providing data link service with the help of high frequency (HF), very high frequency (VHF) antenna. A navigation system consists of landing sensors that are used to enable fully automatic landings. The situational awareness & surveillance systems, integrated flight controls, and simulation and training systems are improving operational aircraft performance. The air traveling safety & security has been increased due to the avionics system. The increasing demand for technologically advanced system is propelling the market.
Increasing Demand for Military Aircraft from Emerging Economies such as China and India Will Aid Growth
The Rafale is a combat military aircraft developed by the Dassault Aviation (France). Real-time generation of high-resolution 3D maps for navigation, tracking ability of aerial targets, and multi-spectral threat warning capability are improving the operational performance of Rafale. In September 2016 Indian government signed a contract with the French government to provide 36 new Rafale fighter jets. In June 2020, the border issue has been raised in between India and China. The Indian Air Force has been requested by the French government to accomplish the delivery of Rafale fighter jets. The increasing border disputes in Southeast Asian countries are propelling the demand for military aircraft. The increasing delivery of military aircraft is directly impacted by the in-built market. Therefore, the increasing demand for military aircraft will aid market growth.
High Maintenance Cost of Avionics Restrict the Market Growth
High maintenance cost is associated with replacing the conventional avionics system. The aircraft computer system is a complex structure of several systems that are used during the flight operation. The high maintenance cost is required to upgrade this system. Therefore, the necessity of upgraded systems is hindering the market growth.
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Hardware Segment Dominated the Market in 2019
Based on the system, the market includes hardware and software. The hardware segment is a combination of automatic flight management system (AFMS), communication, navigation, surveillance (CNS), electrical system, autothrottle, emergency system, mission & tactical system, inflight entertainment system, health monitoring system, collision avoidance system, weather system, and fuel management systems. The hardware segment held a dominant avionics market share in 2019. The dominance of this segment is attributable to the multitasking capability of the hardware system. It carries out trajectory prediction and rote guidance to the aircraft.
The software segment consists of safety-critical airborne software, mission flight management software, flight management software, aircraft health diagnostic software, training & simulation software, and others. The Software segment is projected to register a higher CAGR by 2027 due to the increasing use of software systems in the avionics to improve the flight operation capability.
Military Segment is Anticipated to Grow at Faster Pace during 2020-2027
Based on the platform, the market is classified as commercial, military, business jets, general aviation, and helicopters. The commercial segment held the largest share of the market during the forecast period. Dominance is due to the increasing demand for commercial aircraft type from the last two decades. The increase in the number of air passengers across the world is projected to boost the market. The military segment is projected to register a higher CAGR during the forecast period due to the increasing use of the fighter aircraft computer system in combat aircraft. Business jets, general aviation sector, and helicopters are also registered significant growth during the forecast period.
Growing Business Jet Deliveries across the Globe is Propelling the Market Growth
Based on end-use, the market is classified as original equipment manufacturers and aftermarket. The OEM segment is predicted to grow at the highest CAGR between 2020 and 2027. The growth is attributed due to the increasing number of business jet and military aircraft deliveries across the globe. The research and development (R&D) programs to develop technologically advanced aviation computer components to improve the reliability of aircraft is projected to boost the market.
The aftermarket segment held a dominant share of the market in 2019. The growth is attributed to up-gradation programs from several commercial airlines. The renewal of up-gradation contracts from different aircraft OEMs such as Boeing and Airbus with European airlines drives the growth of the market.
North America Avionics Market Size, 2019 (USD Billion)
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The market size in North America stood at USD 17.62 billion in 2019. The dominance of this region is attributable to the increasing demand for commercial aircraft, military aircraft, and a military helicopter from the U.S. and Canada. The presence of key players such as L3Harris Technologies, Inc, Collins Aerospace, and Garmin Ltd. drives the market in the U.S.
Europe has registered remarkable avionics market growth due to the presence of key players such as Safran and Thales group. Additionally, increasing defense spending from France and Germany is expected to create growth opportunities in Europe.
The market in the Asia Pacific is expected to exhibit healthy growth during the forecast period and owing to the expanding aviation industry in China and India. In addition to this, China aviation continues to remain second-largest defense spending economy after the U.S. According to the global aerospace and defense industry outlook report 2020, and China required 8,090 aircraft over the next 15 years. The rest of the world registers significant growth during the forecast period. This growth is attributed to the increasing spending on commercial aircraft from Latin America and Middle East & Africa.
Standout Research Processes Integrated by Key Market Players to Develop Innovative Avionics Technology is Propelling the Market Growth
The designing of a technologically advanced system, low-cost software-defined radio system, a more efficient communication system for aircraft are the upcoming avionics industry trends. A diversified product portfolio, along with innovative research ideology accepted by key players, is the major factor in boosting the market.
The avionics market research report covers the in-depth technical analysis of the market and majorly focusing on key aspects such as leading market players, COVID-19 effect on the market, product Systems, and leading technological trends, research ideology of the product.
An Infographic Representation of Avionics Market
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Besides this, the report offers insights into the market trends and highlights key industry developments & trends. In addition to the factors above, the report provides multiple factors that will contribute to the growth of the market during the forecast period.
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Value (USD billion)
Fortune Business Insights says that the global avionics market size was valued at USD 48.00 billion in 2019 and is projected to reach USD 75.81 billion by 2027.
In 2019, the North America market value stood at USD 17.62 billion.
Growing at a CAGR of 9.25 %, the market will exhibit steady growth in the forecast period (2020-2027).
The hardware segment is expected to be the leading segment in this market during the forecast period.
Increasing the operational performance of commercial aircraft is propelling the growth of the market.
L3Harris Technologies, Inc, Collins Aerospace, and Garmin Ltd. are major players of the global market.
North America dominated the market share in 2019.
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