Aerospace

Backed by extensive research and data from our software Observatory, Cambashi’s research emphasizes the Aerospace industry’s recovery to pre-pandemic levels and strong future growth prospects.

Cambashi’s e-learning course and Industry Insights include more information about the Aerospace industry, alongside high-level market intelligence from our market-leading datasets.

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What is the current position of the aerospace industry?

Leading global commercial aerospace OEMs estimate that global passenger traffic will return to pre-pandemic levels in 2025. Domestic demand has already surpassed 2019 levels while international travel is lagging. This indicates a changing trend for the industry where air travel becomes less global.
The defense sector of aerospace manufacturing is expected to increase in 2025 as a result of rising geopolitical tensions and pressure from the US Administration for NATO members to increase their spending. A renewed focus on national security will cause significant increases in defense spending.
However, ongoing supply chain issues and high inflation remain the two largest threats to the industry, with both Boeing and Airbus warning of supply chain issues and production delays.
High inflation poses a significant challenge due to its negative impact on household income and consumer confidence, both of which influence air travel demand. The global aerospace industry is particularly affected because major aerospace producers, such as the US, the eurozone, and the UK, bear the majority of the economic impact.
Despite ongoing headwinds, the industry is expected to grow steadily in 2025. Growth will be fueled by an increase in global passenger traffic—particularly from the Asia-Pacific region—and a rise in defense spending. Elevated geopolitical tensions around the world have led a number of countries to increase their defense budgets, driving spending on military aircraft.

Aerospace Industry Trends and Challenges

Aerospace companies face a number of challenges outside of their businesses over which they have little control. The companies best placed to deal with changing market dynamics study industry trends and try to predict them in advance, whilst those poorly prepared adopt a more reactive response and often find themselves playing catch-up. Before the COVID-19 crisis, there were several trends that aerospace companies were responding to.

As the industry recovers from the pandemic, some of those trends remain, and some new challenges have emerged. Some of the underlying trends that will continue to drive the industry forward include:

Sustainability

  • Fuel efficiency/SAF
  • Electric propulsion

Automation & Technologies

  • New developments in avionics
  • Applications for the Internet of Things
  • Growth of Artificial Intelligence
  • Supersonic travel

Supply & Demand

  • Growth in commercial space travel
  • Growing production capacity
  • Mergers & Acquisitions

Some of the long-term challenges facing the aerospace industry include:

  • supply chain disruption
  • labor shortages
  • government restrictions
  • geopolitical instability
  • environmental pressures
  • a host of strict regulations

For more in-depth information about the Aerospace industry, check out our e-learning course and Industry Insights platform.

E-learning course & Insights Platform

E-learning course

  • Self-paced e-learning
  • CPE-approved
  • Designed for customer-facing professionals

Objectives

  • Identify the industry terminology
  • Identify the relationships between typical companies in the industry and understand the structure of a typical business
  • Pick out some of the major issues faced by companies in today’s industry
  • Differentiate between the initiatives they take to respond to business issues

Cambashi Ltd is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE sponsors through its website: http://www.nasbaregistry.org

Industry Insights Platform

  • Tactical industry intelligence updated in real-time by industry experts.
  • The latest trends & challenges, business drivers, products & services, and technology.
  • Key players and consumer perspective
  • Industry terminology and metrics
  • Deeper knowledge across a variety of industry subjects

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Aerospace Related Professions

The employment data highlights the important geographical difference in the makeup of the workforce. AMER has the most workers followed by EMEA and then APAC. Looking deeper, the typically more developed regions of North America and Western Europe have a significantly higher proportion of workers in higher-skilled roles. Comparatively, the workforce throughout each region in APAC is still dominated by traditionally less-skilled occupations.

The employment view of the industry also points to the relative inefficiency of companies in the APAC region. Central Asia has half as many workers as North America and almost the same as Western Europe, yet the value-added generated by the region is much lower. This is then backed up looking at the spend on software, where Central Asia is significantly smaller. This highlights the efficiency gains that regions with more intensive use of software are able to exploit, allowing them to ‘do more with less’.

Data from the Cambashi Employment Observatory shows that world-wide there are 8x the number of managers and skilled trades people compared with architects, engineers and technicians. This represents a significant opportunity not only for Aerospace software vendors but also for businesses looking for further efficiencies as part of digital transformation.

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Engineering Software Market in the Aerospace Industry

Spending on engineering software in the Aerospace industry has grown each year, increasing by around $900m between 2020 and 2024, as the industry recovers from the pandemic. This is incredibly important given the financial health of the industry in 2020. Despite massive pressure to cut costs the industry spent more on software than in the previous year. The reason being companies had to find ways to improve their operational efficiency and streamline processes, both of which can be enabled through the increased use of software.
The upward trajectory in software usage reflects the industry’s recognition of the transformative potential of Big Data. The adoption of these technologies is not merely a response to industry trends but represents a proactive shift towards data-driven decision-making.
Software plays a major role in the aerospace industry as it is essential to design, simulation, production, supply chain, and maintenance activities.
The relative sizes of the Computer-Aided Technologies (Mechanical CAD, Mechanical CAE, CAM) and PLM software sectors in the global aerospace market. The total is worth approximately $US2.4 billion annually. Surprisingly, MCAE is bigger than MCAD, showing the importance of engineering analysis and simulation in the Aerospace sector.
Historically, the MCAD market in aerospace was much larger than MCAE, but the MCAD market is flattening out while MCAE continues to accelerate. The need for virtual and remote working is another factor that is driving both MCAE and MCAD.

Digital Twin
Digital Twins match digital models to physical entities that can range from a single component to an entire aircraft. This is particularly useful when simulating aerodynamic performance using CFD (Computational Fluid Dynamics) to improve the surface flow, and when using FEA (Finite Element Analysis) to stress-test candidate designs.
Wind tunnels and fatigue testing rigs will still be used (as they have been in the past) but Digital Twins make it possible to perform many more design iterations and stress tests prior to building and testing prototypes; they can also be used to model the final, flying aircraft and collect real-time sensor data for analysis, to predict potential failures and the steps to avoid them. Simulation, CFD and analysis are all CAE software capabilities, and the figure shows its relative importance in aerospace compared to CAD, CAM, and PLM.
With the Digital Twin approach, maintenance or upgrades can be planned and tested in detail prior to performing the work and all the correct parts can be obtained in advance – this is particularly important in AOG (Aircraft on Ground) situations when an aircraft is stranded, and it is essential that the correct replacement parts are urgently delivered. The Digital Twin approach is becoming very important in the post-pandemic era as it enables performance-informed decision-making throughout the entire lifecycle of a product or process.

Learn more about Cambashi Market Data
Design/Engineering/Manufacturing Software Market Share – Aerospace Industry

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