Ground support equipment, mainly used for transporting passengers as well as baggage and freight, maintenance support, and repair functions, help in minimizing the turnaround time by improving the operational speed, efficiency, and accuracy. Thus, looking at these advantages, the demand for ground support equipment has increased significantly over the past few years, and is also likely to witness continued growth in the near future as well.
The global ground support equipment (GSE) market which has been estimated to be worth USD 12.22 Billion in 2016 is projected to reach a value of USD 19.44 Billion by 2021, growing at a CAGR of 9.72% during the forecast period 2016-2021.
Among application, the passenger service segment is expected to be the dominant market, and is likely to continue its dominance over the forecast period as well. Based on type, the global market for electric ground support equipment has been predicted to grow at a faster rate, owing to the decreased usage of non-electric vehicles. The airports are expected to increasingly adopt greener ground support equipment, thus conforming to the latest emission norms.
Geographically, which segment is likely to be the leading market and why?
Among regions, North America has been estimated to account for the largest share of the global ground support equipment market in 2016, with the U.S and Canada being the key markets in this region. The GSE market in this region is very competitive, owing to the presence of a large number of original component manufacturers (OCMs) and original equipment manufacturers (OEMs) such as Tug Technologies and Gate GSE, among others. The need for modernization and enhancing the operational efficiency of existing airports in the U.S. is expected to further drive the growth of the GSE market in North America. However, the market in Asia-Pacific is expected to witness the highest growth over the forecast period, mainly due to the increased government spending for the development of airport infrastructure and rising GDP of this region.
What are the major drivers encouraging the market growth?
The increased demand for air travel has necessitated the development of the requisite infrastructure to support the operation of the rising number of aircrafts in service. Inadequate infrastructure is expected to be a barrier to the efficiency of the aviation industry. This has led to various investments being made to expand the infrastructure of the existing airports. Furthermore, the rise in air travel and freight cargo in emerging economies has led to many challenges as traffic at various Asian hubs exceeds capacity. This rise in air passenger traffic and airfreight volume is likely to boost the demand for ground support equipment and other related services.
High service standards at major airport hubs include on-time performance of airlines, professional customer services, and seamless passenger handling starting from check-in to boarding and from disembarkation to timely baggage presentation and handling services. Various airports have taken initiatives to ensure seamless services and improve the turnaround time without compromising the safety by deploying motorized and non-motorized handling equipment such as baggage tractors, air starter units, ground power units, lower/main deck loaders, aircraft pushback units, tarmac coaches, conveyor belt loaders, baggage trolleys, container trailers, and pallet dollies.
What are the limitations and challenges expected to be encountered by this market?
Airports in regions like the U.S. and Europe have been focusing towards replacing older or obsolete ground support equipment, which are not environmental friendly with newer and greener equipment. These initiatives are typically a part of the discretionary spending of airports or are undertaken to conform to the emission norms for such equipment. Furthermore, the recent economic slowdown and the lack of available funding has led to a scenario, wherein, idle equipment became available, thereby leading to excess capacity or surplus equipment. This may contribute to market saturation, thereby reducing prices for older ground support equipment. In addition, the economic recession also led to the consolidation of GSE service providers and pooling of such equipment at certain airports, in an attempt to reduce the overhead and operating costs. This in turn, also increased the availability of excess idle equipment. Moreover, ensuring the availability of just-in-time spares for GSE is a major challenge being faced by the players operating in this market.
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What are the key sustainability strategies adopted by the market players?
JBT Corporation (U.S.), Cavotec SA (Switzerland), Teleflex Lionel-Dupont (France), Toyota Industries Corp. (Japan), and Tug Technologies Corporation (U.S.), among others are the major players operating in the global market for ground support equipment. Gaining new contracts is the key strategy adopted by industry players in order to foster growth in the worldwide GSE market. The rising demand for ground support equipment globally has encouraged companies to adopt this strategy, making it one of the most common of all the strategies adopted. Market players are focusing on entering new markets by launching technologically advanced and environmental friendly products. JBT Corporation, Cavotec SA, and Toyota are some of the leading market players that adopted this strategy in order to develop their business. Besides contracts, companies adopted strategies, such as new product launches, partnerships, opening new manufacturing units, and creating a separate entity in order to expand their product portfolio and distribution network.
How are the strategies contracts and new product launches expected to benefit the market growth?
OEMs have developed a diverse product portfolio owing to its increased focus on R&D for developing more environment-friendly and less fuel-consuming ground support equipment. These products are expected to provide a competitive edge over conventional GSEs. Major companies are now focusing more on securing contracts in order to improve its position in the global GSE market. Geographical presence across the globe is expected to help the companies provide service and secure new clients for its ground support equipment.