Airbus’ new Global Services Forecast predicts a US$4.6 trillion worldwide market for commercial aircraft services from 2018 to 2037. The new analysis is based on a three-way market segmentation, respectively focusing on the aircraft, the airline operation, and the passenger experience.

Aircraft-focused lifecycle services represent the largest segment of growth and include maintenance, spares pool access, tooling, technical training and system upgrades – which are needed to keep the airlines aircraft flying. This market represents a cumulative value of $2.2 trillion over the 20-year period – from $76 billion in 2018 to more than $160 billion per annum by 2037. These services are provided throughout the lifecycle from design to dismantling. In this category, aircraft manufacturers provide customers with core services which come with the aircraft, including assigned field reps and call centres for AOGs for example. The largest market by value is maintenance, increasingly characterised by outsourcing and “paid-by-the-hour” (PBH) contracts. Moreover, as technology and new materials develop, such as composite repairs, Airbus sees a strong trend for further outsourcing. PBH contracts allow airlines to secure and predict their maintenance costs, allowing airlines to focus on their core business of flying. Airbus also sees airlines increase their outsourcing of inventory management – towards pooling, instead of investing in their own stocks.

The next largest category encompasses flight operations services – such as pilot training and flight-planning solutions – and will account for a $1.5 trillion cumulative spend over 20 years. Fleets are expected to more than double to 48,000 aircraft over this period, such that Airbus estimates a need for 540,000 new pilots in the next 20 years. This trend will require ‘smarter’ ways of training using new digital technologies.

The third component of the global services market centres on the passenger experience which will account for an estimated $0.9 trillion cumulative value over the 20 year period. This encompasses the services needed to optimise the flight experience, including cabin upgrades, cabin crew training, in-flight-entertainment, connectivity and booking. This segment is expected to more than double in the next 20 years and grow from $27bn to almost $70bn. A notable trend is that seamless connectivity will undergo exponential growth, as more and more passengers manage their travel using a smart device, providing them all the information in real-time about the airport, connecting flights, bag collection details etc.

Airbus’ ambition in Services – $10bn in revenues and booting customer value

After an 18 percent annual growth in its services revenues for the past two years, Airbus’ ambition is to triple its services revenues from more than $3.2bn in 2017 to reach $10bn of services revenues in commercial in the next decade. To attain this goal, Airbus will continue to develop full lifecycle integrated services for all Airbus’ aircraft operators. Furthermore, these integrated services – such as Flight Hour Services (FHS) – will be even more efficient through the Skywise open data platform.

Airbus will also expand its current service portfolio to non-Airbus platforms, given that 62 percent of Airbus’ total fleet is operated by ‘multi-fleet’ operators. An example of this happening today is illustrated by Airbus’ materials management subsidiary Satair, which already has 25 percent of its revenues coming from non-Airbus parts; while the Navblue flight operations subsidiary also delivers multi-fleet services. Furthermore, Airbus will extend services to a wider customer base – such as airports and air traffic control operations. Lastly, Airbus will reinforce its strategic position in the value chain. Another visible facet of Airbus’ growth in its services is the increasingly local presence, ie. being closer to its customers. Airbus’ developing global services footprint now spans 65 locations globally including 17 training centres.

One common denominator, across all the services which Airbus will increasingly cultivate is ‘digitalisation’, with many solutions being interconnected and integrated. These solutions will create additional value for airlines, lessors and MRO companies, for instance by allowing real-time decision-making, or by optimising flight and maintenance operations through analytics.

Photo: Airbus.

The first BelugaXL has rolled out of the paintshop unveiling a special livery making it look like a Beluga Whale. The livery was one of six choices submitted to Airbus employees through a poll where 20,000 people participated. With 40% votes in favour, the smiley livery won.

The BelugaXL will now undertake gound tests before first flight planned in summer 2018.

The decision to build the BelugaXL was taken in November 2014 to address the transport and ramp-up capacity requirements for Airbus beyond 2019. The new oversize air transporters are based on the A330-200 Freighter, with a large re-use of existing components and equipments. The first of five BelugaXLs will fly in summer 2018 and enter into service in 2019.

Photo: Airbus.

Airbus has made this statement:

Airbus has published a risk assessment outlining the urgent risks to its business arising from the UK exiting the European Union without a withdrawal agreement.

It states that the UK exiting the EU next year without a deal – therefore leaving both the single market and customs union immediately and without any agreed transition – would lead to severe disruption and interruption of UK production. This scenario would force Airbus to reconsider its investments in the UK, and its long-term footprint in the country, severely undermining UK efforts to keep a competitive and innovative aerospace industry, developing high value jobs and competences.

On the future trade relationship between the UK and EU, the Memorandum makes clear that while an orderly Brexit with a withdrawal agreement is preferable to a no-deal scenario, the current planned transition (which ends in December 2020) is too short for the EU and UK Governments to agree the outstanding issues, and too short for Airbus to implement the required changes with its extensive supply chain. In this scenario, Airbus would carefully monitor any new investments in the UK and refrain from extending the UK suppliers/partners base.

Tom Williams, Chief Operating Officer of Airbus Commercial Aircraft, commented:

“In any scenario, Brexit has severe negative consequences for the UK aerospace industry and Airbus in particular. Therefore, immediate mitigation measures would need to be accelerated. While Airbus understands that the political process must go on, as a responsible business we require immediate details on the pragmatic steps that should be taken to operate competitively. Without these, Airbus believes that the impacts on our UK operations could be significant. We have sought to highlight our concerns over the past 12 months, without success. Far from Project Fear, this is a dawning reality for Airbus. Put simply, a No Deal scenario directly threatens Airbus’ future in the UK.”

Airbus has made this announcement:

Airbus will intensively contribute to the next steps in finding a global standard for mission-critical multimedia group communication. After the 3rd Generation Partnership Project’s (3GPP) completion of release 14 of secure multimedia group communication in December 2017, Airbus and its partners within 3GPP are now working on release 15 and 16 by the end of 2019. 3GPP is a global initiative that unites various standard development organisations and sets international telecommunications standards as well as system specifications.

One of the prime intentions is to improve real-time video group communication (MCVideo) and develop a thorough 5G solution. “It is all about verifying the current developments and test transparently the interfaces between our solutions and those of our partners in the 3GPP. We are expecting that the outcome evolves powerfully and will be confirmed in tests in June 2018 and in 2019,” says Eric Davalo, Head of Strategic Development for Secure Land Communications at Airbus.

One of the areas Airbus will closely look at during the plug test in June 2018 is how its application Tactilon Agnet will work with Mission-Critical Push to Talk and Mission-Critical Data solutions (the safe transmission of messages, pictures and videos, but not in real-time). These solutions equally comply with the 3GPP releases 13 and 14 standard definitions. Both mission-critical functions refer to a functionality which allows immediate availability for group and one-to-one communication.

However, the definition of the Mission-Critical Video will still require further improvements with the release 15, before it can be intensively tested. Furthermore, the application’s hybrid use in Tetra and broadband networks will also be under scrutiny to find the best standard. 

“Next June we will take part in an international plug test in Disaster City in Texas, United States, where we will check collaboratively the next level of standard developments with other companies,” says Eric Davalo. “Afterwards, we will be focusing on mission-critical video group communication and start considering the 5G networks which evolve naturally out of the existing 4G technology. Our ideas look really promising.”

Photo: Airbus.

Airbus made this announcement on social media: