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0 icficomaviation |
BUSINESS AVIATION MARKET OUTLOOK
Aerospace Raw Materials Conference
April 24 2012 Pittsburgh PA
Presented by
Michael Holland Manager
mhollandicficom
1 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
2 icficomaviation |
Business Aviation Has Proven to be a Cyclical Industry Over the Past Two Decades
TRENDS DRIVING BUSINESS AVIATION
Source Bombardier
Where will the business aviation market
go from here
Business Jet Industry 20-Year Deliveries
1991ndash2000
3600 Units
2001ndash2010
6400 Units
3 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
There Are Four General Trends That Are Impacting Demand for Business and General Aviation Aircraft
Source ICF Analysis
1 Economic
Recovery
2 Growth in
Emerging
Markets
3 Introduction of
New Models
4 Public Policy
amp Regulation
4 icficomaviation |
Production of Business Jets is Generally Tied to GDP Growth
TRENDS DRIVING BUSINESS AVIATION
Source US Dept of Commerce GAMA IMF
-6
-4
-2
0
2
4
6
8
1981 1986 1991 1996 2001 2006 2011e 2016e
US GDP Growth
1980ndash2016
Change
0
200
400
600
800
1000
1200
1980 1985 1990 1995 2000 2005 2010
US Manufactured Business Jets Delivery
1980ndash2010
Deliveries
1 Economic
Recovery in
North America
5 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In Addition Business Aviation is Highly Correlated to Corporate Profits
2011 based on 12-month total for Q3 2011
Source Roland Vincent Associates
Further economic recovery
will stimulate demand
1 Economic
Recovery in
North America
US Corporate Profits vs Business Jet Cycles
US Corporate Profits ($M) from 1990ndash2011
US FAA Cycles
1990ndash2011
(in 000rsquos)
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
1 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
2 icficomaviation |
Business Aviation Has Proven to be a Cyclical Industry Over the Past Two Decades
TRENDS DRIVING BUSINESS AVIATION
Source Bombardier
Where will the business aviation market
go from here
Business Jet Industry 20-Year Deliveries
1991ndash2000
3600 Units
2001ndash2010
6400 Units
3 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
There Are Four General Trends That Are Impacting Demand for Business and General Aviation Aircraft
Source ICF Analysis
1 Economic
Recovery
2 Growth in
Emerging
Markets
3 Introduction of
New Models
4 Public Policy
amp Regulation
4 icficomaviation |
Production of Business Jets is Generally Tied to GDP Growth
TRENDS DRIVING BUSINESS AVIATION
Source US Dept of Commerce GAMA IMF
-6
-4
-2
0
2
4
6
8
1981 1986 1991 1996 2001 2006 2011e 2016e
US GDP Growth
1980ndash2016
Change
0
200
400
600
800
1000
1200
1980 1985 1990 1995 2000 2005 2010
US Manufactured Business Jets Delivery
1980ndash2010
Deliveries
1 Economic
Recovery in
North America
5 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In Addition Business Aviation is Highly Correlated to Corporate Profits
2011 based on 12-month total for Q3 2011
Source Roland Vincent Associates
Further economic recovery
will stimulate demand
1 Economic
Recovery in
North America
US Corporate Profits vs Business Jet Cycles
US Corporate Profits ($M) from 1990ndash2011
US FAA Cycles
1990ndash2011
(in 000rsquos)
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
2 icficomaviation |
Business Aviation Has Proven to be a Cyclical Industry Over the Past Two Decades
TRENDS DRIVING BUSINESS AVIATION
Source Bombardier
Where will the business aviation market
go from here
Business Jet Industry 20-Year Deliveries
1991ndash2000
3600 Units
2001ndash2010
6400 Units
3 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
There Are Four General Trends That Are Impacting Demand for Business and General Aviation Aircraft
Source ICF Analysis
1 Economic
Recovery
2 Growth in
Emerging
Markets
3 Introduction of
New Models
4 Public Policy
amp Regulation
4 icficomaviation |
Production of Business Jets is Generally Tied to GDP Growth
TRENDS DRIVING BUSINESS AVIATION
Source US Dept of Commerce GAMA IMF
-6
-4
-2
0
2
4
6
8
1981 1986 1991 1996 2001 2006 2011e 2016e
US GDP Growth
1980ndash2016
Change
0
200
400
600
800
1000
1200
1980 1985 1990 1995 2000 2005 2010
US Manufactured Business Jets Delivery
1980ndash2010
Deliveries
1 Economic
Recovery in
North America
5 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In Addition Business Aviation is Highly Correlated to Corporate Profits
2011 based on 12-month total for Q3 2011
Source Roland Vincent Associates
Further economic recovery
will stimulate demand
1 Economic
Recovery in
North America
US Corporate Profits vs Business Jet Cycles
US Corporate Profits ($M) from 1990ndash2011
US FAA Cycles
1990ndash2011
(in 000rsquos)
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
3 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
There Are Four General Trends That Are Impacting Demand for Business and General Aviation Aircraft
Source ICF Analysis
1 Economic
Recovery
2 Growth in
Emerging
Markets
3 Introduction of
New Models
4 Public Policy
amp Regulation
4 icficomaviation |
Production of Business Jets is Generally Tied to GDP Growth
TRENDS DRIVING BUSINESS AVIATION
Source US Dept of Commerce GAMA IMF
-6
-4
-2
0
2
4
6
8
1981 1986 1991 1996 2001 2006 2011e 2016e
US GDP Growth
1980ndash2016
Change
0
200
400
600
800
1000
1200
1980 1985 1990 1995 2000 2005 2010
US Manufactured Business Jets Delivery
1980ndash2010
Deliveries
1 Economic
Recovery in
North America
5 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In Addition Business Aviation is Highly Correlated to Corporate Profits
2011 based on 12-month total for Q3 2011
Source Roland Vincent Associates
Further economic recovery
will stimulate demand
1 Economic
Recovery in
North America
US Corporate Profits vs Business Jet Cycles
US Corporate Profits ($M) from 1990ndash2011
US FAA Cycles
1990ndash2011
(in 000rsquos)
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
4 icficomaviation |
Production of Business Jets is Generally Tied to GDP Growth
TRENDS DRIVING BUSINESS AVIATION
Source US Dept of Commerce GAMA IMF
-6
-4
-2
0
2
4
6
8
1981 1986 1991 1996 2001 2006 2011e 2016e
US GDP Growth
1980ndash2016
Change
0
200
400
600
800
1000
1200
1980 1985 1990 1995 2000 2005 2010
US Manufactured Business Jets Delivery
1980ndash2010
Deliveries
1 Economic
Recovery in
North America
5 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In Addition Business Aviation is Highly Correlated to Corporate Profits
2011 based on 12-month total for Q3 2011
Source Roland Vincent Associates
Further economic recovery
will stimulate demand
1 Economic
Recovery in
North America
US Corporate Profits vs Business Jet Cycles
US Corporate Profits ($M) from 1990ndash2011
US FAA Cycles
1990ndash2011
(in 000rsquos)
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
5 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In Addition Business Aviation is Highly Correlated to Corporate Profits
2011 based on 12-month total for Q3 2011
Source Roland Vincent Associates
Further economic recovery
will stimulate demand
1 Economic
Recovery in
North America
US Corporate Profits vs Business Jet Cycles
US Corporate Profits ($M) from 1990ndash2011
US FAA Cycles
1990ndash2011
(in 000rsquos)
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
6 icficomaviation |
BGA Fleet Per Capita
China
Source Booz amp Company
TRENDS DRIVING BUSINESS AVIATION
Developing Markets Currently Have Very Small Business Aircraft Fleets That Will Grow 2
Growth in
Emerging
Markets
CHINA
bull ~150 business jets
bull ~1000 total private aircraft
(vs 220K in the US)
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
7 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
But the Vast Majority of BGA Aircraft Will Still Go to North America and Europe Over the Next Decade
Source Bombardier
2 Growth in
Emerging
Markets
Regional 10 and 20 year Delivery Outlook
Units Calendar years 2011ndash2020 and 2021ndash2030
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
8 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
In the Next Few Years New Models Are Entering Service ndash Such as G650
Source ICF Analysis Gulfstream Honda Bombardier
G650
2012 2016 2021 2014
New VLJ Light Jets
such as Hondajet
Global 7000 entering
service in 2016 and
8000 in 2017
Other models are entering service by 2014
such as Legacy 450500 Learjet 85
Legacy 500 Learjet 85
3 Introduction of
New Models
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
9 icficomaviation |
TRENDS DRIVING BUSINESS AVIATION
Finally Public Policy amp Regulation Can Have a Huge Impact on Business Aviation Growth
Source ICF Analysis
RegionCountry Policy amp Regulatory Issues
North
America
bull Government policy on dividend taxes depreciation rates changes in
capital gains even the lsquoBuffet Rulersquo all have the potential to adversely
impact business aviation
Western
Europe
bull Proposed higher wealth taxes would curtail business aircraft demand
bull More stringent emissions taxes would also impact BGA
China
bull Growth is highly dependent on liberalization of skies by the Peoplersquos
Liberation Army who currently control 80 of Chinese airspace
bull Addition of 50 to 100 new airports will help stimulate BGA demand but
support services (MRO FBO training) must be upgraded
4 Public Policy amp
Regulation
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
10 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
11 icficomaviation |
The BGA Fleet Comprises 57 Jets and 43 Turboprops ndash Cessna amp Hawker Beechcraft Account for 51 of the Fleet
BUSINESS AVIATION PRODUCTION FORECAST
2011 BGA Fleet By Size Category
Source ACAS
2011 BGA Fleet By Aircraft OEM
Turboprops 13424 43
Light Jets 6750 22
Midsize Medium
6175 20
Heavy Long Range 3886 12
VLJ 885 3
31120 Aircraft
Cessna 7821 33
Hawker Beechcraft
8014 33
Learjet 2230 9
Dassault 1826 8
Gulfstream 1739 7
Bombardier 1383 6
Pilatus 1047 4
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
12 icficomaviation |
North America Generates About Half of the Production Demand for Business Aircraft
Source ICF SHampE
BUSINESS AVIATION PRODUCTION FORECAST
Over 50 of deliveries
occur within North
America
Peak deliveries occur
in 2018
Cyclical economic
downturn built into
forecast
0
200
400
600
800
1000
1200
1400
1600
1800
2000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
2012ndash2021 Annual Business Aviation Production
By Operator Region
North America
Europe
S America
Asia Pacific
Africa Middle East
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
13 icficomaviation |
The Business Aviation MRO Market in 2012 is Worth $98B
BUSINESS AVIATION PRODUCTION FORECAST
Source ICF SHampE
Component $28 28 Mods
$25 25
Engine $24 25
Airframe $22 22
2011 BGA MRO Spend ($B)
By MRO Category
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
14 icficomaviation |
Agenda
Trends Driving Business Aviation
Production Forecast
Raw Material Forecast
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
15 icficomaviation |
0
10
20
30
40
50
60
70
80
90
100
2012 BGA Raw Material
Buy Weight Composition
115 M Lbs
Aluminum Alloys
Steel Alloys
Super Alloys
Titanium Alloys
Other Composites
RAW MATERIAL DEMAND OUTLOOK
Business Aviation is Approximately 10 of All Aerospace Raw Material Demand
Air Transport
78
Military 8 Rotary Wing
4
2012 Aerospace Raw Material
Buy Weight
115 B Lbs
Source ICF SHampE
Fundamental Mill Demand Maintenance repair and overhaul (MRO) excluded from total estimated to add 7 to total
Business amp
General Aviation
10
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
16 icficomaviation |
RAW MATERIAL DEMAND OUTLOOK
Overall Business Aviation Raw Material Demand Will Grow at 28 Over the Next Decade
Source ICF SHampE
0
25
50
75
100
125
150
175
200
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total CAGR =
28
2012 ndash 2021 Business Aviation Raw Material Total Buy Weight
By Material Type
Raw material demand will peak in 2017 amp 2018 with production rates
Growth in composite usage not as dramatic as air transport market
2012-2021 Change
Other +21
Composites +49
Titanium Alloys +53
Super Alloys +48
Steel Alloys +30
Aluminum Alloys +20
Millions Pounds
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
17 icficomaviation |
Key Messages
The shape of the business market
rebound will be driven by economic
recovery emerging regions new
models amp policyregulations
Business amp general aviation
production will grow at 38 CAGR
over the next decade
Raw material demand from business
aviation is approximately 115 million
pounds in 2012
SUMMARY
Source ICF SHampE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
18 icficomaviation |
Aerospace Manufacturing Strategy
Customer Satisfaction amp Retention
MRO Market Research amp Analysis
Cost amp Performance Benchmarking
MampA Commercial Due Diligence
Strategic Sourcing Support
Supply Chain Management
LEAN Continuous Process Improvement
Safety amp Compliance Audits
Thank You
ICF SHampErsquoS ADVISORY SERVICES INCLUDE
Related Documents
