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Contracts, Agreements, and Partnerships are the Key Growth Strategies Adopted by These Market Players to Grow in the Propulsion Systems Market
Propulsion systems form one of the most important and critical components of an aircraft, as these systems generate a forward force known as thrust to set the aircraft in motion. These systems are used to maintain cruising speeds of aircraft. Propulsion systems are used in varied sectors, such as aerospace, defense, and civil aviation.
Growth of the propulsion systems market is dependent on the increased number of deliveries of aircraft, spacecraft, missiles, and unmanned aerial vehicles in various countries of the world. The propulsion systems market is projected to grow from USD 244.68 Billion in 2016 to USD 337.78 Billion by 2021, at a CAGR of 6.66% between 2016 and 2021. Military programs being undertaken across the world for upgrading aircraft and unmanned aerial systems, along with development of new equipment are the factors driving the growth of the propulsion systems market across the globe. Increased budget allocations for carrying out space expeditions and strengthening defense sector in developed as well as emerging economies are also propelling growth of the propulsion systems market across the globe.
General Electric Company (U.S.), Safran S.A. (France), United Technologies Corporation (U.S.), Rolls-Royce Holdings plc. (U.K.), Honeywell International Inc. (U.S.), 3W International GmbH (Germany), Orbital ATK Inc. (U.S.), and Aerojet Rocketdyne Holdings, Inc. (U.S.), among others are the key players operating in the propulsion systems market.
Contracts, agreements, and partnerships are the key growth strategies adopted by these market players to grow in the propulsion systems market. These players are focusing on entering new markets by launching technologically advanced and cost-effective products and acquiring new businesses. The core competencies of these leading market players include increasing their geographical presence by investing increasingly in the R&D activities of local companies in the Middle East and Asia-Pacific regions.
GE Aviation, which is a subsidiary of the U.S.-based General Electric Company, contributed a share of 33% share to the propulsions systems market in 2015. It is a leading player in the propulsion systems market and offers solutions for commercial as well as military aircraft engines. It also offers integrated digital components, electric power systems, and mechanical aircraft systems, among others. In September 2016, CFM International, which is a joint venture between GE Aviation and Safran Aircraft Engines, received a contract worth USD 630 million from Malaysia-based Airlines, Berhad (MAB) to power its 25 firm Boeing 737 MAX aircraft with LEAP-1B engines. The delivery of these engines is scheduled to begin from 2019 onwards. These engines are not only expected to offer 15% improvement in fuel efficiency of Boeing 737 MAX aircraft, but are also expected to reduce CO2 emissions. The core competencies of the company involve delivering of superior, customized products and services to high-growth markets. Moreover, the company also focuses on securing high value contracts and agreements from other well-established players in the market to ensure its future stability.
Safran S.A., which is a France based company, contributed a share of 6% to the propulsions systems market in 2015. The company mainly focuses on securing contracts to improve its position in the propulsion systems market. It is a renowned company in the aerospace & defense market and has been benefited from five major contracts of more than USD 113 million in 2016. The company focuses on research & development activities, technological differentiation, targeted investments, and acquisitions & alliances. In 2016, CFM International received a contract worth USD 270 million from Allegiant (U.S.). Under the contract, the company is required to power 12 new Airbus A320ceo aircraft of Allegiant with CFM56-5B engines, including spare engines as well.
In July 2016, Safran Helicopter Engines, a subsidiary of Safran S.A., received a seven-year contract from Denmark-based Defence Acquisition and Logistics Organization (DALO) to support 14 RTM 322-powered EH101 Merlin, operated by the Royal Danish Air Force (RDAF).
Propulsion Systems Market by Type (Air Breathing Engines, Non-Air Breathing Engines, Electric Propulsion Engines), Application (Aircraft, Spacecraft, Missiles, Unmanned Aerial Vehicles), and Region - Global Forecast to 2021
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