Executive Summary
The aerospace sector is important for Sweden’s economy and competitiveness. Leading companies within this sector include Saab, SAS, and the Swedish Space Corporation (SSC). In 2019, Sweden imported $690 million of aircraft, spacecrafts and parts. U.S. imports are frequently used within the Swedish aerospace market and U.S. suppliers clearly dominate this market. U.S. suppliers market share of the Swedish aerospace industry has grown from 29% in 2017 to 79.5% in 2019 and is an area of opportunity for U.S. exporters.1
Sweden is active in the space industry, which is an aerospace subsector. Sweden invests $159 million a year in space activities, industry, and international cooperation in space.2 Esrange, a city located in north Sweden, accommodates one of Europe’s largest civilian satellite ground stations and acts as a hub in the satellite station network. Esrange is presently used by the international scientific community for launching sounding rockets for microgravity and atmospheric research as well as high altitude balloons for astronomy, atmospheric research and drop tests of space and aerial vehicles.
During 2020, Luleå University of Technology (LTU) developed a new program called RIT2021 (A program whose purpose is to establish Sweden as a leader in the space industry) which aims to stimulate business between the established space industry and regional small and medium enterprises interested in entering the space market.3
The second subsector of Swedish aerospace is the aviation industry. The aviation industry created 90,000 jobs in Sweden and an additional 100,000 jobs in tourism, trade, investments, etc.4 Swedish aviation industry is more research-intensive than most other industries. The research environment is based on collaboration between companies, public actors, and academia. Technical breakthroughs and innovations that take place in aviation research are largely spread to other areas and other industries. One reason is that the willingness and ability to absorb and try new technology and the level of competence is high. Small and medium sized U.S. companies can benefit from the technologically focused environment since technological breakthroughs within the industry are shared.5
1 Global Trade Atlas, HS 8802
www.gtis.com/gta/secure/htscty_wta.cfm
2 Sveriges Radio
sverigesradio.se/artikel/6204067
3 RIT2021
www.ritspace.se/newsletter-rit2021/
4 Regeringen (2020, p.6) www.regeringen.se/490ab0/contentassets/661596dee93f47f397f45dfb59bb9171/2017_flygstrategi_webb_ny.pdf
5 Aerospace
aerospace.se/images/dokument/Nyttan-med-flyg-fr-Sverige-flygfakta-i-fickformat.pdf
Market Entry
Sweden’s major buyers often prefer to operate directly with the seller without going through a middleman, primarily to save on costs. It is common in Sweden for foreign exporters to use consultants to advise on market trends. In the sales process, it is common that the exporter offers to assist in the required certification procedures and prepares the appropriate documentation including manuals and pilot instructions.
In order to be registered in Sweden, new aircraft need to be approved and certified by the European Aviation Safety Agency (EASA). The requirements are similar to those in the United States.
Current Market Trends and Demand
Trends
Space industry
According to Swedish Space Corporation, sustainability is important within the space industry, with focus on UN’s sustainability goals defined in the Agenda 2030 for Sustainable Development. The rapid increase in the number of satellites makes it possible to collect and measure more data on environmental changes across the globe. This data needs the correct infrastructure to be collected, processed and translated into information that can lead to concrete actions for the benefit of humanity.6
A trend in the space industry is the increase of more and smaller satellites. Of all launched satellites, small satellites have increased in launches from 15% in 2010 to 38% in 2017. Another trend over the past decade is that the number of launches is increasing, with current annual launches slightly above 80.7
Another trend over the last decade is that each launch on average lifts up several satellites. Early on, satellites were typically launched one by one, while in recent times each launch contains several satellites. The average number of satellites per launch increased from two in 2015 to 4.5 in 2017.8
Aviation industry
Given the Nordic location, Sweden is dependent on its aviation industry and air travel connections both domestically and internationally. With faster and safer aircraft, new airline alliances, more airports, increased competition, and attractive prices, air traffic has become a common mean of transportation.
Sustainability is of great importance for the Swedish aviation industry and the goal is to be fossil fuel free by 2045.9 According to the Swedish government, the aviation industry in Sweden contributes to meeting society and the market’s need for reduced environmental impact and higher energy efficiency. The government focuses on green approaches, more efficient aircraft, new engine types and alternative fuels.10 The initiative of going green can create opportunities for U.S. suppliers.
In 2019 due to the movement “Skolstrejk för klimatet” (School strike for the climate) lead by Greta Thunberg, people are less willing to fly, which resulted in a 4% passenger decrease.11
Demand
Space industry
Since 2013, commercial infrastructure (products related to development, operation, and launches of satellites) has increased in demand. The industry accounted for $85 billion in 2013 and has increased to $125 billion in 2016, an increase of 47%.12
Aviation industry
In the aviation industry, the market demand for aircraft and aircraft parts is closely linked to the volume of airline passenger traffic. In 2019, there were 40.2 million airline passengers with the majority flying from Stockholm-Arlanda and Gothenburg-Landvetter.13 The number of passengers traveling by international flights has increased annually except for in 2019 when the current environmental trend resulted in a 4% decrease of passengers. Between 2017 and2018, the volume of passengers traveling by international flights increased by 2%. Travelers traveling outside of Europe increased by 9%, implying trends and increased demand for long-distance flights. Meanwhile, demand for domestic flights has decreased over the last years14.
The largest single buyer of U.S. aircraft and parts is the SAS Group15. In addition to SAS, there are several airlines operating in Sweden: TUI Fly Nordic, Malmo Aviation, Novair, West Air Sweden, Wizz Air, Ryanair and BRA.16
2019 market share, international flights (latest figures17) includes:
- SAS—24.4%
- Norwegian—19%
- Ryanair—8%
- Other—49.6%
2019 market share, domestic flights (latest figures18) includes:
- SAS—49.2%
- Norwegian—18.7%
- BRA—29.7%
- Other—2.4%
Helicopters
There are 24 helicopter airports in Sweden and 21 civilian helicopter airlines operating.19
U.S. suppliers of helicopters exceeding 2,000 kg have a market share of 66% in 2019, an increase from 49% in 2017.20 Swedish defense uses U.S. imported helicopters.
6 Swedish Space Corporation
www.sscspace.com/wp-content/uploads/2020/06/SSC-Summary-2019.pdf
7 Omvärldsanalys Rymd 2017
8 Omvärldsanalys Rymd 2017
9 Svenskt flyg
www.svensktflyg.se/wp-content/uploads/2018/04/F%C3%A4rdplan-f%C3%B6r-fossilfri-konkurrenskraft-flygbranschen.pdf
10 Regeringen www.regeringen.se/490ab0/contentassets/661596dee93f47f397f45dfb59bb9171/2017_flygstrategi_webb_ny.pdf
11 Swedavia
www.swedavia.se/globalassets/statistik/swedavia_201912.pdf
12 Omvärldsanalys Rymd 2017
13 Swedavia
www.swedavia.se/globalassets/statistik/pax_201912.pdf
14 Swedavia
www.swedavia.se/globalassets/statistik/swedavia_201912.pdf
www.swedavia.se/globalassets/statistik/swedavia_201812.pdf
15 SAS Group
www.sasgroup.net/newsroom/press-releases/2019/sas-flygplan-far-nytt-utseende/#:~:text=Som%20ett%20led%20i%20moderniseringen,Airbus%20A350%2C%20och%203%20st
16 Skyscanner
www.skyscanner.com/flights-to/se/airlines-that-fly-to-sweden.html
17 My new desk
www.mynewsdesk.com/se/transportstyrelsen/documents/rapport-flygtrafikstatistik-utvecklingen-under-2019-93046
18 My new desk
www.mynewsdesk.com/se/transportstyrelsen/documents/rapport-flygtrafikstatistik-utvecklingen-under-2019-93046
19 Helis
www.helis.com/database/country/SE/
20 Global Trade Atlas, HS 880211
www.gtis.com/gta/secure/htscty_wta.cfm
Opportunities
Space industry
LTU is launching a Business Development program called RIT2021, a collaborative EU funded project with the objective to create sustainable growth in the Swedish space industry. The goal is to help small and medium enterprises tap the aerospace market, increase awareness of opportunities and needs within the industry as well as connecting companies to potential buyers. This program can present opportunities for small and medium-sized U.S. companies. The Swedish aerospace industry is experiencing growth and has an ongoing need for subcontractors in manufacturing, construction, transport, IT, project management, staffing, etc.21
Aviation industry
There are several areas and trends within the Swedish aviation industry that present opportunities for U.S. companies. Categories that have increased in value (U.S. imports to Sweden) between 2017-2019 are aircrafts not exceeding 2,000 kg (+45%) and aircrafts exceeding 15,000 kg (+820%).
Total Swedish import of aircrafts not exceeding 2,000 kg has had a high annual growth of 5-10% over the last three years. The market share of U.S. suppliers has additionally increased from 63% in 2017 to 77% in 2019, implying that U.S. suppliers grows in degree of reputation on the Swedish market.22
Total imports of aircrafts exceeding 15,000 kg has had significant growth between 2017 and 2018, but has decreased by 19% in 2019.23 Even if the total import market is relatively unstable, U.S. supplier’s market share has increased from 26% in 2017 to 84% in 2019. U.S. suppliers of aircrafts exceeding 15,000 kg can benefit from these indicators, since they are supported by higher demand and trends within long-distance and international flights.
21 Ritspace
www.ritspace.se/new-sme-business-development-program/
22 Global Trade Atlas, HS 880220
www.gtis.com/gta/secure/htscty_wta.cfm
23 Global Trade Atlas HS 880240
www.gtis.com/gta/secure/htscty_wta.cfm
Trade Events
Aerospace Technology Congress
September 4 -9, 2022
Stockholm Waterfront Conference Centre, Stockholm, Sweden
Aerospace Technology Congress with the theme of sustainable aerospace innovation in a globalized world.
Contact
Johan Björkman
U.S. Embassy Stockholm, Sweden
Commercial Specialist
johan.bjorkman@trade.gov
+46 (0) 8 783 53 56
