Advanced Aviation Economics

This report discusses the Boeing Current Market Outlook (CMO) and the Airbus Global Market Forecast (GMF) and their impact on the aviation industry. It also explores the factors driving air travel growth and the connection with microeconomic theory of supply and demand.

Running head: ADVANCED AVIATION ECONOMICS
ADVANCED AVIATION ECONOMICS
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ADVANCED AVIATION ECONOMICS
Introduction
This report aims to discuss the Boeing Current Market Outlook (CMO) and the
Airbus Global Market Forecast (GMF) and an overview is provided about these aspects along
with the use by the manufacturers by broader aviation industry. The most important factors
that is believed by the Airbus and Boeing would help in driving the air travel growth.
Connection with the microeconomic theory of the supply as well as the demand is detailed in
the report. At last an appropriate conclusion is provided for the report.
Discussion
Overview and explanation of the use
 The forecasts that have been made by the Boeing Current Market Outlook (CMO) and
the Airbus Global Market Forecast (GMF) has been anticipated to register almost
CAGR of increasingly 3% while the forecast period (Petrescu et al., 2017).
 The Airbus GMF estimates that fleet would be more than the double from than
present times that means 21,500 aircraft to almost 48,000 in almost 20 years time
period. Growth in this group would help in the growth of the services business that
would become double over 20 years from almost US$150 billion in 2018 to 330
billion a year by 2037 that makes it a total of US$4.6 trillion (Nair & Paulose, 2014).
 Along this phase, the modern technological development that includes the rise in the
number of the linked aircraft would result in the growth of the e-enabled services. The
technological development is predicted towards introduction of the modern
opportunities for delivering the facilities that would profit not only the customers of
the organisation nonetheless the passengers also (Comitz & Kersch, 2016). The
analysis and the access to the data from the aircraft and the operations would be at
core of the innovations.

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 As per the Boeing Current Market Outlook (CMO), the airlines have made significant
strides towards the maximisation of the efficiency of the operations using the
techniques and the tools for minimising the cost, then maximise the load factors and
utilisation of the aircraft (Helmreich & Merritt, 2017).
 The increase in the outsourcing would impact significantly in future as the pressure
from the competition and it might help in lowering the yields.
 For reflecting the new opportunities and the trends, the service forecast of the
company has expanded their scope in comparison to the last year (Peeters et al. 2016).
These forecasts are utilised by the manufacturers and the broader industry of aviation for
predicting the passengers increase and then manage the services accordingly that would
help in providing personalised services to the customers (Rhoades, 2016).
Purpose of investment
The aviation industry implements the increased investment in the forecasting as it
would help in the efficient prediction of the future state of the airline. The aviation industry
utilises the forecasting for the both short term decisions like the whether to hope for the
adverse weather conditions and the methods by which the effective response could be
provided and for supporting the longer term decisions respected to the future patterns in the
demand for any air travel (Wagner & Walton, 2016). The scope and the use of the aviation
forecasts could vary significantly. The companies significantly invest in the forecasting to
understand the passengers behaviour and the availability of the resources in the present times.
Factor driving the air travel growth
There are several factors that are expected to have significant impact on the growth of
the air travel. Some of the factors of the growth of the air travel are:

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Population and age structure: The population size affects demand of the air travel as
significant basis of demand increases the demand for the mobility. Therefore, the population
of the country has been considered while the estimation and the differentiation of the demand
of the air travel is done.
Urban agglomerations: The origin and the destination of the traffic flows are
increasingly important for understanding the demand of air travel. Huge share of the
European citizens reside in the urban agglomerations. The trend of the people in the
European could be considered and understood that the growth of the air demand would
increase in the coming years (Hari, Yaakob & Binitha, 2015).
Along with the businesses and the tourism being the drivers of the growth of the
aviation, the demographic factors like the migration could help significantly for stimulating
one more category of the air transport. The trend of the people to visit their family and the
friends would significantly help in the growth of the aviation industry.
Connection with the microeconomic theory of supply and demand
These factors has significance in relation to the book by Baye and Prince. This
denotes that the supply and demand would go in synchronization and help in the growth of
the industry. The factors that are discussed above are directly connected to the growth of the
industry of the air travel due to the increased demand of the people to travel in quick
transport without the issue of any kind of worries. It would help significantly in the growth of
the growth.
Conclusion
Therefore, it can be concluded that the forecasting of the probable situation in the near
times would help the companies to achieve significant business growth. Along this phase, the
modern technological development that includes the rise in the number of the linked aircraft

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ADVANCED AVIATION ECONOMICS
would result in the growth of the e-enabled services. The technological development is
predicted towards introduction of the modern opportunities for delivering the facilities that
would profit not only the customers of the organisation nonetheless the passengers also As
per the Boeing Current Market Outlook (CMO), the airlines have made significant strides
towards the maximisation of the efficiency of the operations using the techniques and the
tools for minimising the cost, then maximise the load factors and utilisation of the aircraft.
The increase in the outsourcing would impact significantly in future as the pressure from the
competition and it might help in lowering the yields. These factors has significance in
relation to the book by Baye and Prince. This denotes that the supply and demand would go
in synchronization and help in the growth of the industry.

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ADVANCED AVIATION ECONOMICS
References
Comitz, P., & Kersch, A. (2016, April). Aviation analytics and the Internet of Things.
In 2016 Integrated Communications Navigation and Surveillance (ICNS) (pp. 2A1-1).
IEEE.
Hari, T. K., Yaakob, Z., & Binitha, N. N. (2015). Aviation biofuel from renewable resources:
routes, opportunities and challenges. Renewable and Sustainable Energy Reviews, 42,
1234-1244.
Helmreich, R. L., & Merritt, A. C. (2017). Culture at work in aviation and medicine:
National, organizational and professional influences. Routledge.
Nair, S., & Paulose, H. (2014). Emergence of green business models: The case of algae
biofuel for aviation. Energy Policy, 65, 175-184.
Peeters, P., Higham, J., Kutzner, D., Cohen, S., & Gössling, S. (2016). Are technology myths
stalling aviation climate policy?. Transportation Research Part D: Transport and
Environment, 44, 30-42.
Petrescu, R. V., Aversa, R., Akash, B., Corchado, J., Berto, F., Mirsayar, M., ... & Petrescu,
F. I. (2017). Home at airbus. Journal of Aircraft and Spacecraft Technology, 1(2).
Rhoades, D. L. (2016). Evolution of international aviation: phoenix rising. Routledge.
Wagner, S. M., & Walton, R. O. (2016). Additive manufacturing’s impact and future in the
aviation industry. Production Planning & Control, 27(13), 1124-1130.