Is the industry headed for a recession? We have frequently mentioned our view that it appears to us that an order bubble has formed. Does fleet data provide a different perspective on the market?If we only look at the passenger market, which is the biggest and attracts the most attention we see the following fleet breakdown by number of seats. The source data for the chart are active aircraft from the Jet Information Services database by year, and includes all aircraft types, from 19 seat turboprops to Russian-built jetliners.
It is notable that the market is consistently growing year after year. Between 2000 and 1Q16, the fleet grew over 70%, reflecting the average 5% growth in traffic. It is the kind of performance that reflects the rosy market forecasts from Airbus and Boeing. Because that time period includes SARS, the oil price spike and drop, several wars and 9/11 and numerous other terrorist attacks, one could assume the commercial aviation business has become somewhat immune to these external challenges.
