We’ve heard it over and over again this year: The BizAv market is looking up! Things are finally getting better! In fact, 43.3% of respondents to JetNet iQ’s latest operator survey believe that the business aviation market has passed the low point and is on the upswing.
Now that we’re a full quarter into 2014, it’s a good time to take a hard look and see if we were too optimistic about the business aviation market recovery.
Some improvement factors to note:
- Macroeconomic fundamentals are slowly improving.
- Business jet flying in the U.S. is increasing.
- Pre-owned inventories continue to fall.
- Sales transactions are strong.
- Business jet deliveries this year are on the rise for the first time since 2008.
“Take a look around, because this is the recovery,” JetNet iQ director Rollie Vincent said at the NBAA Aircraft Finance, Registration and Legal Conference.
Although private jet pricing remains soft, it does look like the US bizav market is, in fact, recovering. Some experts believe that these predictions are true in the U.S., but perhaps not as likely in other countries. “The signs of recovery in business and general aviation in North America continued, with movements up 4% in the first quarter,” found BBA Aviation’s flight support division.
Flights for large cabin aircraft have risen 10.4% since March 2013 and the primary buyers are large U.S. corporations. Most of Western Europe remains depressed and buyers in many emerging markets are cautious. The situation in Ukraine is not good news for bizav sales to Russia or the CIS (at least one aircraft sale fell through because the buyer is on the sanctions list).
The conclusion? The U.S. market is definitely recovering, but that good luck isn’t necessarily holding for European countries. We’ll have to keep waiting for worldwide improvement.