Why the Aviation Industry is Important in 2020


Why Aviation is Important in 2020

The Aviation Industry spans the entire globe and is pushing the limits towards exploring travelling outside out immediate atmosphere. As we enter a new year during our few days of the year we are experience what some would call the calm before the storm.

As companies and governments are returning back to their respective offices from the Holiday breaks we can start to see strategic decision being made to best prepare for the upcoming year ahead. There has been some major incidents that will need to be corrected so that we can continue to grow in a positive manner towards creating an industry that is profitable and also sustainable moving forward into the future.

The aviation industry although having received some recent backlash from the media is an essential part of our global economy that can not be simply removed.

Finding the solution to Sustainable Aviation.

With global media companies highlighting and broadcasting the global protest towards environmental awareness the topic of aviation has been on the forefront of discussion.

The points discussed on the environmental impact that is a result of the aviation industry can be addressed to nearly every aspect of the industry. From not just flying aircraft but also in the practices used during manufacturing, repair and overhaul, fueling and safety having procedures and systems in place that are focused towards long term sustainability of the industry is essential.

Nonetheless just because the news has recently been highlighting the need for sustainable aviation practices does not mean that the industry has not been working hard towards addressing those issues.

For over a decade Sustainable Aviation Fuels (SAF) have been under testing and implementation. The concept of sustainable aviation fuel derives from the practices and sources of which aviation fuel is created.

Scientist and organizations such as BP fuels and AvFuel have been able to develop SAF’s that can be produced in scale with significantly less carbon footprint. SAF’s are not to be confused with completely green and Eco-friendly flying that produces no emissions. The Sustainable fuels are created from organic sources and recycled products. The material is broken down and produces a quality of fuel similar to that of JET-A in performance when burned.

Using Sustainable Aviation Fuels does not mean that the aircraft is flying without having to burn fuel at all, it is the active process in using fuels that are more environmentally conscious in the method how they are sourced and as a result the burn results in significantly less CO2 being released without a loss of performance.

This is essential for airline operations, as now the same commercial flight that you flew before can now use an alternate fuel source to perform the same flight while significantly having a decrease in carbon footprint.

The application of aircraft that operate with non-fuel burning engines is in the works. Currently battery powered engines are limited by payload and range of flight.

Aircraft powered by solar powered energy currently are limited by speed and performance levels. With more pressure towards preserving the environment this next year will require massive development in the industry.

Will the Boeing 737-MAX Fly this year?

The story of the year for aviation has been about the Boeing 737-MAX. Just about every major news station was broadcasting the reports made by the NTSB and the FAA regarding the safety of the Boeing 737-MAX. Back in March of 2019 Aviation Authorities around the world made the firm decision of grounding the aircraft until further notice.

The cause of the grounding was as a result of two crashes that occurred within month of each other killing close to 350 lives between the two aircraft.

As investigation began more information was discovered regarding staff members being aware of the potential dangers present and management continuing to push the deliveries. Since the aircraft are unable to be delivered Boeing Yard has been using every inch of ramp space to park and store the aircraft.

As more aircraft continued to be produced at scale there finally came a time where there was no longer any more space available and production came to a halt just before Christmas.

Boeing chief executive, Dennis A. Muilenburg was laid off just before the holidays as the board of directors have felt that he was not able to properly recover from the incident. With Dave Calhoun taking on the role of president and CEO he will be entering the office on Jan 13 in 2020.

The next year will need affirmative action to correct the mistakes made so that Boeing can begin delivering some of the aircraft that are parked sitting idle of their ramp and continue to push production of new aircraft.

How will tension in Middle East affect defense companies?

As fear goes up in the nation defense companies rise in value. There are a plenty of defense companies present which give the military options. This creates healthy competition with the sector to allow for the best company to win the contract. A few of the major Defense Contractors include but are not limited to

  • Raytheon.
  • BAE Systems.
  • Northrop Grumman.
  • General Dynamics.
  • Airbus Group.
  • Thales.
  • Lockheed Martin,
  • Boeing,
  • Aerovironment,

In recent global news the Middle East is once again in the forefront of the headlines. President Trump has recently taken action towards a General in Iran that has been categorized as an act of war by other analyst and companies.

From a recent statement made by President Trump, the decision was made to prevent a war and not to start a war. None the less the reality is present and national security is a very key factor in our nations economy.

Aviation Defense Contractors play a major role in our nation. A most recent bill passed to approved a new defense budget for 2020. The $738 billion for fiscal 2020 represents a $21 billion increase over what Congress enacted for fiscal 2019.

These funds are allocated towards a variety of military operations. A great portion of funds are often allocated towards aviation as it is one of the most expensive sectors as well.

Defense companies will be fighting for a piece of the pie in the next coming year. With an increased budget this will attract more private companies to work towards winning the hearts of the military in developing new technology.

Moving forward this year will certainly bring in a lot of economic activity. As we look at new opportunities and avenues for growth and development staying true to our values and ethics is going to be key in the next year to come.

With technology advancing at alarming rates and wealth being redistributed through the market, it is essential that we appropriately analyze and decide the best course of action.

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As a disclaimer all trade ideas are for education purposes and not meant to be used as financial advise. All investing involve risks, including loss of principal. Past performances do not guarantee future results or success. Stock and Forex markets are volatile and can decline significantly in response to adverse regulatory, market, economic development. Asset allocation and diversification do not eliminate risk. All Content is used for illustrative purposes and for educational use only.

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