Aviation industry faces near-term volatility and long-term growth

The aviation sector faces significant structural shifts and long-term growth opportunities. According to Morningstar DBRS, European airlines may see a widening gap between large, financially stable carriers and smaller competitors by 2026. This polarization is driven by high kerosene prices, rising maintenance costs, and global delivery delays from manufacturers like Airbus and Boeing. Additionally, the expiration of fuel price hedging mechanisms is expected to force airlines to purchase fuel at higher market rates, while conflicts in the Middle East necessitate longer, more expensive flight routes.

Looking toward 2045, Airbus forecasts a massive expansion in the aviation services market. The company predicts that global passenger numbers will double to 10 billion annually, supporting a worldwide fleet of over 45,000 aircraft. This growth is expected to drive the aviation services market to a value exceeding $420 billion, creating a demand for over 2.4 million new professionals, including technicians, pilots, and cabin crew.