Some Segments Could See Over 14 Percent Growth From 2014-2018

Indonesia is one of the developing nations in the APAC region, which is characterized by a rapidly growing economy. There is an eminent growth in the Middle Class Population segment and its disposable income, which is making them increasingly prefer air travel for tourism, healthcare needs, education, and business purposes. The increased air travel has created a new surge in the demand for aircraft, which is a lucrative opportunity for the Commercial Aircraft market in Indonesia. Currently, Indonesia is active in the manufacturing of commercial aircraft parts and MRO services and the commercial aircraft manufacturing is in its nascent stage.

The Commercial Aircraft market in Indonesia is growing rapidly in the APAC region. The Commercial Aircraft Parts Manufacturing market in Indonesia and the MRO market in Indonesia are growing at a CAGR (Compound Annual Growth Rate) of 14.21 percent and 6.21 percent, respectively, for the period 2013-2018.

The growth of the Commercial Aircraft market in Indonesia is driven by several factors. One of the major drivers in this market is the increase in demand among the burgeoning middle class population segment. The growing middle class in the developing nations increasingly prefer to travel by air, owing to their increase in disposable income. This has urged the airline companies to purchase more commercial aircraft to match up with the growing demand. Another major driver is the increasing government commitment to aviation infrastructure.

Despite the presence of several drivers, the Commercial Aircraft market in Indonesia is curtailed by certain serious challenges. One of the main challenges in this market is the weak Indonesian economy and low forex rate. Although the Indonesian economy is growing rapidly among its other peer countries such India and Bangladesh, the country is suffering from lack of resources. Due to this, either most of the processes are outsourced or the resources are hired from overseas at higher costs. This results in a sluggish growth for the Commercial Aircraft market in Indonesia. Another major challenge is the lack of adequate infrastructure for the Aviation industry in Indonesia.

Despite the presence of these challenges, the Commercial Aircraft market in Indonesia is witnessing some impressive trends in the market. One of the key trends is the increasing focus on manufacturing of commercial aircraft in order to meet the pacing demand for air travel. PT. Dirgantara, the sole aircraft manufacturer in Indonesia, has initiated a project with Lion Air, a leading private airline company, to manufacture four units of commercial N219 aircraft by 2016. Another major trend in the market is the increasing focus of the GOI to invite private investors to enhance aviation capacities.

FMI: www.researchandmarkets.com/research/kst78m/commercial