Northbrook, IL -- (SBWIRE) -- 01/10/2021 -- The global helicopter market size is projected to grow from USD 21.3 billion in 2020 to USD 36.9 billion by 2025, at a CAGR of 11.7% from 2020 to 2025. Increased demand for military helicopters is a significant growth driver for the helicopters market. Increased demand for light weight and emergency medical services (EMS) helicopters are other drivers for the market.
Helicopter Market Dynamics
Driver: Increasing demand for lightweight helicopters
Saving fuel and operational efficiency are the prime focus areas of helicopter manufacturers based on end-user requirements. Technological advancements in the aerospace & defense industry and demand for improved helicopter power performance are driving the need to update military and commercial helicopters. Manufacturers have undertaken efforts to reduce the overall weight of helicopter engines to help reduce fuel consumption and enhance cost-effectiveness. Increased efforts of helicopter manufacturers to reduce the size and weight of helicopters have resulted in technological advancements. On average, a helicopter engine weighs approximately 10-15% of the overall operating weight, depending on the helicopter type and the application. Moreover, fuel is one of the major costs for helicopter operators.
In 2018, over 1300 light helicopters were delivered. As per Honeywell's 20th Turbine-Powered Civil Helicopter Purchase Outlook released in 2018, light single-engine helicopters are the most desired class of helicopters. The Outlook published in March 2019 identified the popularity of light single-engine helicopters and highlighted their demand in North America, Asia Pacific, and the Middle East and Africa. 25% of European respondents of the Outlook's survey mentioned plans to buy light single-engine helicopters in the near future.
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Restraint: Defense budget reductions in developed nations
Defense budgets of developed countries have gradually declined due to budget sequestration in the defense sector during the last five years. The US Department of Defense proposed a reduction in defense funding by approximately USD 487 billion for the 2012–2021 budget. Europe also undertook stringent measures to reduce military spending, with major countries such as Germany, the UK, Spain, Italy, Ireland, Belgium, and France showing an overall reduction in defense spending from 2011-2018. A few developed countries are expected to undertake further reductions to help optimize their defense budgets.
Combat helicopter manufacturers are expected to face tough market conditions during the next few years owing to the declining defense budgets of the US, Japan, the UK, France, Italy, and Russia, among others. The declining defense budgets are expected to significantly impact the helicopters market.
Opportunity: Commercialization of urban air mobility (UAM) and eVTOL can serve as an alternative to helicopter
Urban air mobility is a concept that uses the vertical take-off capabilities of helicopters and combines these with upcoming electric-hybrid propulsion technologies as well as an autonomous flight for inter- and intra-city travel. These electric helicopters, also known as electric vertical take-off and landing (e-VTOL) aircraft, will have the capability to take-off and land from vertiports built for urban transport in cities. In addition to speeding-up urban travel, these aircraft will help reduce emissions and noise.
The UAM market has the potential to grow to over USD 1 billion by 2030, for applications such as air taxis, personal air vehicles, cargo air vehicles, and air ambulances, among others. This is expected to offer opportunities to players in the helicopters market, who have the design and manufacturing capabilities to integrate electric-hybrid propulsion along with autonomous flight capabilities in their helicopters to increase their market share in the market.
Companies such as Uber (US) have collaborated with various OEMs, such as Bell (US), Karem Aircraft (US), and Boeing (US), among others, to commercialize the urban air mobility concept by 2023. When commercialized, this concept is expected to enable passengers to share e-VTOL air services between cities and suburbs, and eventually within cities.
Challenge: Stringent regulatory norms for the manufacture of helicopter components
The aerospace industry is highly regulated, mainly due to the risks associated with flight operations. A multitude of bilateral, national, and international regulations and standards bind the actions of manufacturers of helicopters and their components. Countries across the globe have regulatory bodies governing the safety levels associated with helicopter operations. In addition, the International Civil Aviation Organization (ICAO) has implemented regulations that are required to be adhered to globally. All helicopter components and systems must meet the regulatory requirements of the ICAO to ensure the safety of helicopter operations and control risks associated with defective components.