laws, we expressly disclaim any intention, and assume no obligation to update or ... BOMBARDIER BUSINESS AIRCRAFT | MARK
MARKET FORECAST 2015-2024
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FORWARD LOOKING STATEMENTS
This presentation includes forward-looking statements, which may involve, but are not limited to: statements with respect to our objectives, guidance, targets, goals, priorities, our market and strategies, financial position, beliefs, prospects, plans, expectations, anticipations, estimates and intentions; general economic and business outlook, prospects and trends of an industry; expected growth in demand for products and services; product development, including projected design, characteristics, capacity or performance; expected or scheduled entry-into-service of products and services, orders, deliveries, testing, lead times, certifications and project execution in general; our competitive position; and the expected impact of the legislative and regulatory environment and legal proceedings on our business and operations. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “anticipate”, “plan”, “foresee”, “believe”, “continue”, “maintain” or “align”, the negative of these terms, variations of them or similar terminology. By their nature, forward-looking statements require us to make assumptions and are subject to important known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecasted results. While we consider our assumptions to be reasonable and appropriate based on information currently available, there is a risk that they may not be accurate. For additional information with respect to the assumptions underlying the forward-looking statements made in this presentation refer to the respective Guidance and forwardlooking statements sections in Overview, Bombardier Aerospace and Bombardier Transportation sections in the Management’s Discussion and Analysis (“MD&A”) in the Corporation’s financial report for the fiscal year ended December 31, 2014.
Certain factors that could cause actual results to differ materially from those anticipated in the forward-looking statements include risks associated with general economic conditions, risks associated with our business environment (such as risks associated with the financial condition of the airline industry and rail industry, political instability and force majeure), operational risks (such as risks related to developing new products and services; fixed-price commitments and production and project execution; doing business with partners; product performance warranty and casualty claim losses; regulatory and legal proceedings; the environment; dependence on certain customers and suppliers; human resources), financing risks (such as risks related to liquidity and access to capital markets, retirement benefit plan risk, exposure to credit risk, certain restrictive debt covenants, financing support provided for the benefit of certain customers and reliance on government support) and market risks (such as risks related to foreign currency fluctuations, changing interest rates, decreases in residual values and increases in commodity prices). For more details, see the Risks and uncertainties section in Other in the MD&A the Corporation’s financial report for the fiscal year ended December 31, 2014. Readers are cautioned that the foregoing list of factors that may affect future growth, results and performance is not exhaustive and undue reliance should not be placed on forward-looking statements. The forward-looking statement set forth herein reflect our expectations as at the date of this presentation and are subject to change after such date. Unless otherwise required by applicable securities laws, we expressly disclaim any intention, and assume no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this presentation are expressly qualified by this cautionary statement.
All amounts in this presentation are expressed in 2014 U.S. dollars unless otherwise indicated. Global 5000, Global 6000, Global 7000, Global 8000, Learjet 40, Learjet 45, Learjet 70, Learjet 75, Learjet 85, Challenger 350, Challenger 650, Bombardier, Bombardier Business Aircraft, Bombardier Vision and The Evolution of Mobility are either Unregistered or Registered Trade-Mark(s) of Bombardier Inc. or its subsidiaries. BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
2
TABLE OF CONTENTS
1. INTRODUCTION AND EXECUTIVE SUMMARY 2. BOMBARDIER BUSINESS AIRCRAFT OVERVIEW 3. BUSINESS AIRCRAFT MARKET DRIVERS 4. BUSINESS AIRCRAFT MARKET FORECAST 5. FORECAST BY REGION 6. CONCLUSION 3
EXECUTIVE SUMMARY
INTRODUCTION Bombardier Business Aircraft is pleased to present its 2015 edition of the Business Aircraft Market Forecast, debuting at the European Business Aviation Convention and Exhibition in Geneva. The forecast provides an in-depth look at how six primary market drivers (wealth creation, globalization of trade, emerging markets, new aircraft programs, replacement demand and accessibility) will shape the future of business aviation over the next 10 years. This analysis focuses specifically on aircraft categories in which Bombardier competes: Light, Medium and Large, as well as major world regions.
THE BUSINESS JET MARKET IN 2014 In 2014, the business jet industry continued its path towards recovery, led by the strengthening North American economy. North American business jet orders and deliveries in the markets where Bombardier competes were strong in 2014, driven by solid domestic business investment, a thriving stock market and sustained consumer spending. However, orders and deliveries lagged in other regions as a result of several challenges which held back a broader recovery in the world economy. European GDP growth remained sluggish overall but gained some momentum in the later part of 2014.
China’s growth decelerated while Russia ended the year on the brink of recession due to falling oil prices and significant economic restrictions imposed by the western world. Last year the industry reached 601 aircraft deliveries, a 6% increase from 2013. Demand for long range business travel continued to grow, though at a slower pace, which resulted in a total of 200 deliveries for Large category aircraft. Medium category aircraft had 212 total deliveries, a modest recovery expected to accelerate as world GDP growth improves in upcoming years. Light category deliveries amounted to 189 aircraft, less than half the level of deliveries seen when the market peaked in 2008. Having secured more aircraft orders and deliveries since the downturn in 2009 than any other manufacturer, Bombardier Business Aircraft continues to hold its position as industry leader. In 2014, Bombardier Business Aircraft delivered 204 business aircraft, amounting to 34% delivery market share.
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
4
EXECUTIVE SUMMARY
BUSINESS JET VALUE PROPOSITION AND LONG-TERM VISION FOR THE INDUSTRY Business jets have proven to be a cost-effective, fast, and safe method of travel1. The benefits of business travel include on-demand flight scheduling, the ability to conduct business privately during flights, direct access to company sites and reduced travel time. While we acknowledge the slow growth facing the industry today, we believe the strong value proposition for business jets remains uncontested. In the long term, with continued wealth creation in mature markets and increased penetration of business jets in emerging markets, the overall market for business jets will show strong growth. As a result, our long-term forecast remains relatively unchanged from the forecast published last year.
Our 10-year delivery forecast predicts 9,000 business aircraft deliveries valued at $267 billion. In the following sections, we present our detailed forecast and analysis of the business jet industry for key regions across the world. In a series of studies conducted between 2009 and 2013, NEXA Advisors evaluated the impact of business jet ownership on small to large companies, as well as government agencies. Its most recent study on business aviation and the world’s top performing companies concluded that companies using business jets were likely to outperform non-users on revenue growth, innovation, employee satisfaction and market share. 1
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
5
BOMBARDIER BUSINESS AIRCRAFT Strength in numbers
2014 ACHIEVEMENTS
204 13% DELIVERIES
INCREASE VERSUS 2013
34% 10
TH
DELIVERY MARKET SHARE
CONSECUTIVE YEAR AS A LEADER1
PROGRAM MILESTONES
LEARJET
CHALLENGER
GLOBAL
DELIVERED
DELIVERED
DELIVERED
AND COUNTING
AND COUNTING
AND COUNTING
40/45/70/75 SERIES
600 1
Delivery unit leader in those segments where Bombardier competes.
300 SERIES
500
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
SERIES
600
6
BUSINESS AIRCRAFT MARKET DRIVERS Drivers have a positive relationship with the business aircraft market
WEALTH CREATION
GLOBALIZATION OF TRADE
EMERGING MARKETS
NEW AIRCRAFT PROGRAMS
REPLACEMENT DEMAND
ACCESSIBILITY
Expansion of economic activity in the world, measured by Gross Domestic Product
Expansion of trade from interregional partners to a globally connected economy
Growth of the world’s developing markets and the convergence of business jet adoption towards mature market levels
Introduction of new and technologically advanced aircraft models into the industry
Demand generated from the retirement of aircraft
Alternatives to full business jet ownership
The evolution of these drivers will shape the outlook of the industry BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
7
ECONOMIC DRIVERS
BUSINESS JET FLEET AND WORLDWIDE ECONOMIC GROWTH
1970
1980
1990
2000
2010
2014
FLEET (# aircraft)
830
2,000
4,650
8,650
14,150
15,735
WORLD ECONOMY ($ trillion)
18.5
27.3
37.4
49.3
65.2
72.3
Growth in the business jet fleet has followed growth of the world economy
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
8
15
,7 35
ECONOMIC DRIVERS
EMERGING EMERGENCE ECONOMIES
5
% POCKETS OF GROWTH OF NEW GDP GROWTH
15
,7 35
EXPANDING GLOBALIZATION OF TRADE
EMERGING ECONOMIES
3%
AVERAGE WORLD GDP
5%
GDP GROWTH
72 .3
2%
GDP GROWTH
3%
AVERAGE WORLD GDP
2014
72 .3
MATURE ECONOMIES
trillion)
2%
GDP GROWTH
2014 MATURE ECONOMIES
($ trillion)
Expanding globalization of trade is driving the need for direct city-to-city access
High growth economies are accounting for a greater share of world wealth
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
9
BUSINESS JET MARKET SEGMENTATION
In production: 34 In development: 14
VERY LIGHT
BOMBARDIER*
LIGHT
MEDIUM
LARGE
Learjet 70
Challenger 350
Global 5000
Learjet 75
Challenger 650
Global 6000
LARGE CORPORATE AIRLINERS
Global 7000 Global 8000
CESSNA
Mustang
CJ4
Citation X+
M2
XLS+
Longitude
CJ2+
Latitude
CJ3+
Sovereign+
DASSAULT EMBRAER
Phenom 100
GULFSTREAM
F2000S
F7X
F2000LXS
F5X
F900LX
F8X
Phenom 300
Legacy 500
Legacy 450
Legacy 650
G150
Lineage 1000E
G280
G500
G450
G550 G600 G650/G650ER
OTHER
INDUSTRY DRIVERS
Hondajet
PC-24
ACJ 318/319
SJ30-2
BBJ 1/2/3
Eclipse 550
BBJ Max 8/9
Introduction of several new and more capable models stimulates demand and replacement purchase decisions *
Learjet 85 program on pause
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
10
INDUSTRY DRIVERS
2,050
REPLACEMENT DEMAND
2,050
Full ownership
Full ownership
mulative siness jet tirements
0
ACCESSIBILITY
14 1980
Cumulative business jet 699 retirements
342 1960
1990
14 1970
2000
1980
699 342
2014
1990
2000
Branded charter
Branded charter
Air taxis
Air taxis
Fractional Fractional ownership ownership Jet card Jet card programsprograms
2014
Increased pace of retirements drives demand for replacement aircraft
Several alternatives to full business aircraft ownership exist that extend the benefits of private jet travel to many users
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
11
MARKET DRIVERS OUTLOOK Future projections of key market drivers
WEALTH CREATION
The global economy is expected to continue improving. GDP growth is forecasted to cross the 3% threshold by 2016-2017.
NEW AIRCRAFT PROGRAMS
Several new models will enter service between 2015-2024 which will attract new buyers and stimulate replacement activity.
GLOBALIZATION OF TRADE
Trade globalization will continue, particularly with and between emerging markets, increasing the need for direct city-to-city access.
REPLACEMENT DEMAND
1,825 worldwide business aircraft retirements forecasted over the next 10 years will drive increased replacements.
EMERGING MARKETS
Fleet size in these regions is expected to continue growing as business jet adoption approaches mature market levels.
ACCESSIBILITY
Operators in the charter and fractional market are renewing their fleets. International expansion will drive future growth.
The outlook for the long-term drivers of business jet demand remains strong BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
12
2015-2024
10 TOTAL
YEARS
LIGHT
MEDIUM
LARGE
$137B 3,400 $91B 3,100 38% $39B
51%
34% 34%
2,500 28%
15%
FORECAST BY AIRCRAFT SIZE CATEGORY
$267 9,000 Billion
Deliveries
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
13
FORECAST BY AIRCRAFT SIZE CATEGORY Light category KEY CHARACTERISTICS
10-YEAR FORECAST
3,400
TYPICAL PURCHASE PRICE
$9-20 M
3,100
8,770
CABIN VOLUME1 3
300 ft to 700 ft3
-
+
+
-
11,085
1,085 7,755
690
5,345
=
CAGR
=
2.4%
CAGR
3.8%
RANGE
2,000 to 3,000 NM
2014 Fleet
2014 Fleet
Light category aircraft offer intraregional range at an entry-level cost 1
Cabin volume of 8.5 m3 to 19.8 m3
Deliveries
Deliveries
+
+
Retirements
Retirements
-
-
2024 Fleet
2024 Fleet
=
=
Light category will generate a total of 3,400 deliveries from 2015 to 2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
14
FORECAST BY AIRCRAFT SIZE CATEGORY Medium category KEY CHARACTERISTICS
10-YEAR FORECAST
TYPICAL PURCHASE PRICE
3,100
$20-42 M
3,100
5,345
CABIN VOLUME1 3
700 ft to 1,500 ft3
-
+
+
-
7,755
690
7,755
690
5,345
=
CAGR
=
3.8%
CAGR
3.8%
RANGE
3,100 to 5,000 NM
2014 Fleet
2014 Fleet
Medium category aircraft offer greater cabin comfort, range and speed 1
Cabin volume of 19.8 m3 to 42.5 m3
Deliveries
Deliveries
+
+
Retirements
Retirements
-
-
2024 Fleet
2024 Fleet
=
=
Medium category will generate a total of 3,100 deliveries from 2015 to 2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
15
FORECAST BY AIRCRAFT SIZE CATEGORY Large category KEY CHARACTERISTICS
10-YEAR FORECAST
TYPICAL PURCHASE PRICE
$50-72 M
3,100
+
CABIN VOLUME 3 1
5,345
>1,500 ft
1,620
-
2,500
+
- 7,755 50
690
=
CAGR
9.6%
CAGR
4,070
=
3.8%
RANGE
>5,000 NM 2014 Fleet
2014 Fleet
Large category aircraft offer the greatest cabin comfort, range and speed 1
Cabin volume > 42.5 m3
Deliveries
Deliveries
+
+
Retirements
Retirements
-
-
2024 Fleet
2024 Fleet
=
=
Large category will generate a total of 2,500 deliveries from 2015 to 2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
16
FORECAST BY REGION
TOTAL 2015-2024:
9,000 DELIVERIES
NORTH AMERICA
3,900
EUROPE
1,525 CIS
510
LATIN AMERICA
850
AFRICA MIDDLE EAST 275
400
SOUTH ASIA
310
GREATER CHINA
875
ASIA PACIFIC
355
North America, Europe, China and Latin America will be the largest markets for business aircraft over the next 10 years BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
17
2.6%
FORECAST BY REGION NORTH AMERICA
$23.3
$18.1 2014
2015-2024 INDUSTRY DELIVERIES
ECONOMIC GROWTH
3,900 $96 Units
CAGR
2.6%
2024
FLEET GROWTH
CAGR
CAGR
2.6%
2%
Billion in revenue
12,715
10,090
KEY FACTS
$23.3aviation • Birthplace of business
$23.3
$18.1
$18.1
• Largest market for business aircraft
2015-2024 OUTLOOK 2014 2024
2014
$ U.S. trillion (2010)
• Average economic growth of 2.6% per year 2%
12,715
• Light and Medium category aircraft account for over 80% of deliveries 2014
2024
For the purposes of this forecast, North America includes the United States and Canada.
Units
LIGHT 2%
• Will remain the largest market for business aircraft
MEDIUM
LARGE
LIGHT
12,715
2,060
2,060
10,090
53%
$33B
34%
$24B
1,140
53%
$39B
29%
25%
2014
2024
FORECAST BY CATEGORY
CAGR
• Fleet compound CAGR annual growth rate of 2%
• Forecasted to receive 3,900 deliveries 10,090 valued at $96 billion
2014
2024
41%
700 18%
$
$24B 25%
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
18
1.8%
FORECAST BY REGION EUROPE
$22.3
$18.6 2014
2015-2024 INDUSTRY DELIVERIES
1,525 Units
CAGR
1.8%
$50
FLEET GROWTH
CAGR
CAGR
1.8%
7%
Billion in revenue
2,850
1,435
KEY FACTS
• Second largest$22.3 market for$18.6 business jet deliveries
2015-2024 OUTLOOK 2014
ECONOMIC GROWTH
2024
2024
• Average economic growth of 1.8% per year
2014
2024
Units FORECAST BY CATEGORY
CAGR
LIGHT 7%
% • Will remain 7the second largest market for business jet deliveries
• Medium and Large category aircraft account for almost 70% of deliveries
2014
2024
$ U.S. trillion (2010)
• Fleet compound annual CAGR growth rate of 7%
2,850 • Forecasted to receive 1,525 deliveries 1,435 valued at $50 billion
$22.3
$18.6
MEDIUM
500
62%
$14B 465
33%
28%
2024
For the purposes of this forecast, Europe includes the EU27 plus Albania, Andorra, Bosnia, Croatia, Iceland, Kosovo, Liechtenstein, Macedonia, Montenegro, Norway, Serbia, and Switzerland. European fleet and deliveries are adjusted to exclude deliveries to CIS-based owners that register their aircraft in Europe.
500
37%
$
33%
$5B
$5B 2014
560
30%
10%
2014
LIGHT
$31B
2,850
1,435
LARGE
10%
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
19
6.5%
FORECAST BY REGION GREATER CHINA
$16.7
$8.9 2014
2015-2024 INDUSTRY DELIVERIES
875 Units
CAGR
6.5%
ECONOMIC GROWTH
$33
FLEET GROWTH
CAGR
CAGR
6.5%
13%
Billion in revenue
1,255
385
KEY FACTS
$16.7 • Exceedingly fast fleet growth over the$8.9 last 10 years at more than 20% per year
2014
• Medium and Large category aircraft account for 90% of deliveries
For the purposes of this forecast, Greater China includes China, Hong Kong, Macau and Taiwan.
Units
LIGHT 13%
MEDIUM
1,255
385
$14B
475 55%
LARGE
LIGHT
$18B
$
55%
42%
310 35%
$1B 2024
2024
FORECAST BY CATEGORY
CAGR
CAGR annual • Fleet compound growth rate13of 13% %
385
2014
2024
$ U.S. trillion (2010)
• Average economic growth of 6.5% per year
• Forecasted to receive 875 deliveries valued at $33 billion1,255
$16.7
$8.9
2014 2024 2015-2024 OUTLOOK
2014
2024
2014
3%
90
$1B
10%
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
3%
90 10%
20
3.3%
FORECAST BY REGION LATIN AMERICA
$7.9
$5.7 2014
2015-2024 INDUSTRY DELIVERIES
850 Units
CAGR
3.3%
ECONOMIC GROWTH
$24
2024
FLEET GROWTH
CAGR
CAGR
3.3%
3%
Billion in revenue
2,505
1,925
KEY FACTS
$7.9 • Relatively mature market for$5.7 business aviation • Brazil and Mexico account for 60% fleet 2014 of the regional 2024
2014
2024
Units FORECAST BY CATEGORY
CAGR
•A verage economic growth CAGR of 3.3% per year
LIGHT 3%
3% • Fleet compound annual growth rate of 3%
• Light and Medium category aircraft account for 75% of deliveries
2014
2024
$ U.S. trillion (2010)
2015-2024 OUTLOOK
2,505 • Forecasted to receive 850 deliveries 1,925 valued at $24 billion
$7.9
$5.7
MEDIUM
LARGE
2,505
1,925
$11B
350
$9B 290 37%
41%
2024
34%
For the purposes of this forecast, Latin America includes all countries between the Rio Grande and Cape Horn.
41%
210 25%
$4B 2014
350
46%
17%
2014
LIGHT
$4B 17%
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
21
2.4%
FORECAST BY REGION CIS
$2.8
$2.2 2014
2015-2024 INDUSTRY DELIVERIES
510 Units
CAGR
2.4%
ECONOMIC GROWTH
$16
FLEET GROWTH
CAGR
CAGR
2.4%
6%
Billion in revenue
1,035
555
KEY FACTS
$2.8 • Business aviation in CIS began $2.2 in the early 1990s
2014
Units
LIGHT 6%
6% • Fleet compound annual growth rate of 6%
MEDIUM
1,035
555
$9B
56%
LARGE
$1B
57%
$6B
90
130 25%
18%
$1B
6%
2014
LIGHT
290 38%
• Medium and Large category aircraft account for over 80% of deliveries
For the purposes of this forecast, the Commonwealth of Independent States (CIS) includes Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine and Uzbekistan.
2024
FORECAST BY CATEGORY
CAGR
• Average economic growth CAGR of 2.4% per year
2024
2014
2024
$ U.S. trillion (2010)
2015-2024 OUTLOOK
1,035 • Forecasted to receive 510 deliveries 555 valued at $16 billion
$2.8
$2.2
• Fleet has grown by nearly 7% per year early 1990s 2014 since the 2024
2014
2024
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
90 18%
6%
22
4%
FORECAST BY REGION MIDDLE EAST
$4.9
$3.3 2014
2015-2024 INDUSTRY DELIVERIES
400 Units
CAGR
4%
ECONOMIC GROWTH
$15
FLEET GROWTH
CAGR
CAGR
4%
7%
Billion in revenue
780
410
KEY FACTS
$4.9market • Remains a promising for$3.3 business aviation
$4.9
$3.3 2014
• Long distances between cities and difficult justify 2014 ground transportation 2024 the need for business aviation CAGR • Average economic growth of 4.0% per7year %
LIGHT 7%
410 • Forecasted to receive 400 deliveries valued at $15 billion
For the purposes of this forecast, the Middle East region also includes Turkey.
Units FORECAST BY CATEGORY
MEDIUM
LARGE
$5B
180
60%
45%
33%
$1B
60
160 40%
$1B
15%
7%
2014
LIGHT
$9B
780
410
• Medium and Large category aircraft remain the aircraft of choice 2024
2024
$ U.S. trillion (2010)
CAGR
• Fleet compound annual growth rate of 7% 780
2014
2024
2015-2024 OUTLOOK
2014
2024
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
60 15%
7%
23
2.5%
FORECAST BY REGION ASIA PACIFIC
$13.8
$10.8 2014
2015-2024 INDUSTRY DELIVERIES
355 Units
CAGR
2.5%
$14
FLEET GROWTH
CAGR
CAGR
2.5%
6%
Billion in revenue
$13.8 • Geographic position necessitates $10.8 the need for long range aircraft
2015-2024 OUTLOOK
2014
FORECAST BY CATEGORY
LIGHT 6%
% • Forecasted 6to receive 355 deliveries valued at $14 billion
MEDIUM
For the purposes of this forecast, Asia Pacific excludes Greater China and South Asia.
LIGHT
205 58%
$1B
$2B
22%
14%
7%
2014
79%
720
405
LARGE
$11B
80 2024
2024
Units
CAGR
• Fleet compound annual CAGR growth rate of 6%
for close to 60% of deliveries
2014
2024
$ U.S. trillion (2010)
2024
720account • Large category aircraft 405
$13.8
$10.8
• Average economic growth of 2.5% per year
2014
720
405
KEY FACTS
2014
ECONOMIC GROWTH
2024
80
70 20%
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
$1B
22%
7%
24
7%
FORECAST BY REGION SOUTH ASIA
$5.1
$2.6 2014
2015-2024 INDUSTRY DELIVERIES
310 Units
CAGR
7%
ECONOMIC GROWTH
$12
FLEET GROWTH
CAGR
CAGR
7%
12%
Billion in revenue
455
150
KEY FACTS
$5.1 its regional • Continues to develop $2.6aviation market business
$5.1
$2.6 2014
• Infrastructure and regulatory environment continue 2014 2024 to slowly improve CAGR • Average economic growth of 7% per year 12%
LIGHT 12%
150 • Forecasted to receive 310 deliveries valued at $12 billion
For the purposes of this forecast, Asia Pacific includes Afghanistan, Pakistan, Bhutan, India, Bangladesh, Sri Lanka, Maldives, and Nepal.
Units FORECAST BY CATEGORY
MEDIUM
150
LARGE
LIGHT
$9B 75%
455
160 52%
70
• Large category aircraft account for over 50% of deliveries 2024
2024
$ U.S. trillion (2010)
CAGR
• Fleet compound annual growth rate of 12% 455
2014
2024
2015-2024 OUTLOOK
2014
2024
$1B
$2B
23%
25%
17%
8%
2014
70
80
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
$1B
23%
8%
25
4.8%
FORECAST BY REGION AFRICA
$3.5
$2.2 2014
2015-2024 INDUSTRY DELIVERIES
275 Units
CAGR
4.8%
ECONOMIC GROWTH
$7
2024
FLEET GROWTH
CAGR
CAGR
4.8%
5%
Billion in revenue
595
380
KEY FACTS
$3.5 • Important market for business aircraft $2.2 deliveries • Fleet size has more than doubled in the past 10 years 2014 2024
2014
2014
2024
2024
$ U.S. trillion (2010)
2015-2024 OUTLOOK
Units FORECAST BY CATEGORY
CAGR
• Average economic growth CAGR of 4.8% per year
LIGHT 5%
5% • Fleet compound annual growth rate of 5%
595 • Forecasted to receive 275 deliveries 380 valued at $7 billion
$3.5
$2.2
MEDIUM
$3B 110 43%
100
40%
36%
$3B
2024
$1B 2014
100
43%
65 24%
14%
2014
LIGHT
595
380
• Light and Medium category aircraft account for over 75% of deliveries
LARGE
36%
$1B 14%
2024
BOMBARDIER BUSINESS AIRCRAFT | MARKET FORECAST 2015-2024
26
CONCLUSION In 2014, business aviation continued on its path towards recovery. Though industry orders lagged, deliveries increased by 6% compared to the previous year. Over the next 10 years, we expect Large category aircraft will represent half of overall revenues at $137 billion while Medium and Light category aircraft will represent $91 billion and $39 billion respectively. Emerging markets like China, Russia, and Latin America will once again be key drivers to future growth as current challenges in these markets subside. Our 2015 edition of the Business Aircraft Market Forecast predicts a promising future for business aviation in the years ahead. With the most extensive product portfolio of any manufacturer, Bombardier is well positioned to lead the industry forward.
RESOURCES Ascend Asian Sky Group B&CA – Business & Commercial Aviation Magazine GAMA – General Aviation Manufacturers Association IBAC – International Business Aviation Council IHS Global Insight World Economic Outlook, January 2015 JETNET NEXA Advisors This presentation can be found on BUSINESSAIRCRAFT.BOMBARDIER.COM 27