Ground Support Vehicles Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The Ground Support Vehicles Market is forecasted to grow at a CAGR of more than 5% during the forecast period (2021-2026).
The global aviation sector is undergoing an unprecedented disruption due to the COVID-19 pandemic. The commercial aviation sector has been significantly affected by the pandemic, resulting in a drastic reduction in passenger traffic, which in turn, has negatively affected aircraft demand. As a result, the commercial aviation sector is expected to recover slowly, as travel demand is projected to normalize to pre-COVID levels by 2023.
The Ground Support Vehicles Market is driven by the increasing demand for such systems to enhance the operational efficiency of the airports witnessing an increase in cargo and passenger traffic. The availability of equipment leasing options, as that of aircraft engines, also makes this a lucrative investment wherein a particular capex is capable of reaping long term benefits. However, the sophisticated nature of the equipment render the market too capital intensive to operate in and the short technological lifecycle of such products means a current flagship product wherein huge chunk of money has been invested may be outdated within a short span of time, or may be superseded by a competitive product with similar or better performance characteristics at the same or even lower price point. Innovations in existing electric and diesel ground support equipment are envisioned to offer growth opportunities for the manufacturers of this equipment.
The growth of passenger traffic has driven the airport construction and expansion projects. However, the expansion of airports also increases their carbon footprint with more energy required to power new terminals, ground transport vehicles and the creation of infrastructure. With the aviation sector reeling under the pressure of stringent emission norms, airports are adopting green technologies to reduce their carbon footprint. For instance, in January 2021, Munich Airport started operating all-electric aircraft pushback tugs from EFM, a joint subsidiary of Lufthansa and Flughafen Munchen GmbH, to comply with the airport's climate protection goals that aim to achieve CO2neutrality by 2030.
Moreover, the cost intensive nature and price fluctuations have also bolstered the adoption of the rental model of usage enabling end-users to temporarily enhance their operational capabilities as per requirement at minimal costs. On this note, in November 2021, Holden Plant Rentals Ltd. was awarded the tractor hire contract for 40 tractors for the Dublin Airport. The company recently commissioned a new fleet of 150hp to 235hp Massey Ferguson tractors for the purpose of running snow ploughs and brushes at the Dublin Airport's runways. Such developments are expected to propel the growth of the segment during the forecast period.
The Asia-Pacific region is expected to generate the highest demand for airport ground support vehicles market during the forecast period. In recent decades, Asia's rapid growth in the commercial aviation sector has positioned the region as the largest and fastest-growing in the world. The region is expected to register the highest growth rate in terms of air passenger traffic. However, aviation infrastructure is not keeping pace with this growth. Several airports in Asia are already operating above their planned capacity. Consequently, congestion-related delays are increasing at most Asian hubs. In order to cope with the rising demand for air travel, several airports in the Asia-Pacific region are significantly investing in enhancing their airport infrastructure. Several airport construction and expansion projects are currently underway in countries, like India, China, the Philippines, Vietnam, and Australia. The expansion of airports in major cities with huge passenger traffic has created an opportunity for the manufacturers to introduce and offer their advanced ground support vehicles. Also, the airport operators are procuring and testing new support vehicles that may allow them to simplify the airport operations. For instance, in August 2018, GVK Mumbai International Airport Ltd inducted an Advanced Passenger Evacuation Vehicle for rescuing passengers and crew from inaccessible areas of aircraft. Such developments are envisioned to render a positive outlook for the market in Asia-Pacific.
The market of airport ground support vehicles is fragmented in nature and is characterized by several suppliers who provide various types of vehicles like passenger buses and stairs, refuelers, deicers, tugs, and tractors, etc. However, some of the prominent players in the airport ground support vehicles market are John Bean Technologies Corp, Textron Inc. (Textron Ground Support Equipment Inc.), Vestergaard Company, Tronair Inc., and Mallaghan Engineering Ltd. The development of new technologies, like electric aircraft tugs and electric GPUs, among others, are anticipated to support the companies and attract new customers (airlines as well as airport operators). For instance, Build Your Dreams (BYD) unveiled two new electric tow tractor models in October 2018. These tugs support the needs of ground handlers at tarmacs and aviation logistics centers and facilities and allow for rapid, restriction-free charging. The introduction of new advanced vehicles can help a company to gain new contracts and expand its market dominance during the forecast period.