Bombardier Aerospace forecasts a return to sustained growth in the business aviation market, although deliveries won't improve significantly this year.
In its annual business aviation forecast released Wednesday, Bombardier projects deliveries of 24,000 business jets from 2011 to 2030 with revenue of $626 billion.
That's 2,000 fewer aircraft and $35 billion less revenue compared with last year's projections.
Bombardier's commercial aircraft market forecast, meanwhile, projects deliveries of 13,100 aircraft in the 20- to 149-seat market, worth nearly $639 billion. That's an increase of 300 aircraft from last year's forecast.
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Bombardier released its business and commercial aircraft forecasts during the European Business Aviation Convention & Exhibition in Geneva, Switzerland.
China, India and other developing regions are leading the global recovery in both markets, it said.
"We are confident in our future, and as the market continues to recover, we are building on our strong commitment to innovation and reinforcing our position in commercial and business aviation," Bombardier president and chief operating officer Guy Hachey said in a statement.
The bulk of business jet deliveries in the next 20 years will be in the back half of the forecast, Bombardier said.
From 2011 to 2020, Bombardier predicts deliveries of 10,000 business jets worth $260 billion. Meanwhile, it forecasts deliveries of 14,000 business jets in the 10-year period from 2021 to 2030 worth $366 billion.
The industry's improving book-to-bill ratio — the number of orders taken versus the number of deliveries — is a positive signal that the market has turned the corner and is gaining momentum, Bombardier said.
"Key indicators are showing an upward trend, and it is expected that business aircraft deliveries will continue to grow in 2012," it said.
Bombardier said it predicts that North America, Europe and China will be the three most active markets generating the most revenue over the next 20 years.
Demand in the commercial aircraft market will be driven by new technology with improved operating efficiencies, passenger comfort and reduced environmental impact, Bombardier said.
At the same time, economic growth forecasts in developing markets are well above the worldwide average and present "sizable opportunities for new aircraft sales."
Over the next 20 years, demand for commercial aircraft from markets outside North America and Europe will increase considerably, according to the forecast.
For example, China's fleet of 20- to-149-seat commercial aircraft is expected to become the third largest, closely behind Europe and the U.S.
One area of concern is the volatility of oil prices, which creates uncertainty with the airlines, it said.
Global demand for air travel has slowed in the short term with political changes taking place in many oil-producing countries and climatic events such as Japan's earthquake and tsunami.
Long term, however, the price of oil will drive airlines to accelerate the retirement of older, less-efficient aircraft and increase demand for new technology and more-fuel-efficient aircraft.
Continuing yield pressures and a focus on environmental sustainability will also drive demand for modern aircraft with lower operating costs, according to the forecast.
Bombardier's 20-year forecast reflects a trend toward larger-capacity commercial planes.
Bombardier projects demand for 20- to 59-seat aircraft at 300 planes over the next 20 years.
It forecasts demand for aircraft with 60 to 99 seats at 5,800 aircraft and demand in the 100- to 149-seat segment at 7,000 new aircraft.
More than half of the current commercial aircraft fleet will be replaced over the next 20 years because of technical obsolescence, with the largest number of replacements coming in the 100- to 149-seat category.
Learjet 85 update
Bombardier also gave an update on its Learjet 85 program at EBACE on Tuesday, saying development has moved from the detail design stage to the build, test and validate phase.
About 1,300 Bombardier employees are working on the program at Bombardier facilities in Wichita; Montreal, Quebec; Belfast, Northern Ireland; and Queretaro, Mexico.
In April, Bombardier completed the critical design review, an achievement the company hails as a major product development milestone.
In Wichita, construction of a facility for the Learjet 85's final assembly line has begun. It's the first of four site expansions.
Suppliers are also preparing to take on work and commissioning the systems test rigs that allow them to exercise their systems and identify and take any corrective action before supplying parts to the final assembly line in Wichita.
In Montreal, employees are completing the last production drawings for the test aircraft, while Belfast workers have built the first production wing spars and are producing the wing skins. Both will be shipped to the Queretaro for final wing assembly.
Parts production has begun at the Mexico Manufacturing Center in Queretaro, and production of the majority of the composite parts for the first aircraft is under way.
The Learjet 85 is positioned between the midsize Learjet 60 XR and the super-midsize Challenger 300. It is scheduled to enter service in 2013.
More from EBACE
* Hawker Beechcraft said the business jet market is steadily recovering after bottoming out last year.
The company announced results from a survey of 48 aviation finance experts conducted by Hawker Beechcraft and Corporate Jet Investor.
All the experts interviewed said they expected demand for aviation finance to increase in Europe, the Middle East and Africa over the next five years, the company said.
"Our research suggests that we can expect emerging and developing markets, which are projected to enjoy sustained growth over the next few years, to provide a growing opportunity for corporate aircraft lessors and lenders," Hawker Beechcraft vice president for Global Aircraft Financing Kirsten Bartok said in a statement.
* Hawker Beechcraft also announced that it has delivered 12 Beechcraft T-6C military trainers to the Royal Moroccan Air Force, which is replacing its fleet of T-34 and T-37 trainers with the T-6C.
The contract for 24 planes was awarded in 2009 and represents a government-to-government agreement between Morocco and the U.S.
* Hawker also announced an aftermarket winglet retrofit kit for the Hawker 750 to improve performance in time-to-climb, range and fuel consumption.
* Hawker said it has appointed MNG Jet at Ataturk Airport in Istanbul, Turkey, to its global network of limited service centers to support Hawker 800 and 900 series business jets.