By GORDON GILBERT • Contributor - Accidents and Regulations
April 19, 2024

Carbon dioxide emissions of turbine business aircraft departing from U.S. airports are down 62 percent from 2005, meaning the industry appears to have already achieved its long-term goal of halving emissions by 2050 relative to 2005 levels—at least in the U.S. This is according to data from the Environmental Protect Agency’s (EPA) latest annual inventory of greenhouse gas emissions, released yesterday.

In 2022—the most current year for which EPA has data—turbine business aircraft accounted for 9.8 percent of the 231.5 million tonnes of CO2 emissions of all turbine aircraft operations in the U.S. and just 1.3 percent of all transportation emissions in the U.S. These calculations apply to fuel purchased in the U.S. and used by aircraft taking off from U.S. airports.

Notably, the EPA data indicates that carbon emissions from U.S. business jets and turboprops fell 38 percent from 2019 to 2022, while at the same time business aircraft utilization climbed 22.6 percent. Per TraqPak data from Argus International, turbine business aircraft departures from U.S. airports rose from 4.02 million flight hours in 2019 to 4.93 million flight hours in 2022.

Overall turbine airplane emissions in the U.S. “decreased by 5 percent between 2019 and 2022, but have decreased 7 percent since 2007,” the report states. Decreases in jet fuel emissions starting in 2007 are “due in part to improved operational efficiency that results in more direct flight routing, and improvements in aircraft and engine technologies to reduce fuel burn and emissions.” However, the sharp decline in commercial aircraft emissions from 2019 to 2020 and their gradual recovery since is primarily due to Covid-19 impacts.

According to NBAA president and CEO Ed Bolen, every new model of business aircraft is as much as 30 percent more efficient than a model it replaces. “We are pioneers in efficiency, gaining advances, whether it's winglets, whether it's composite technologies, early adoption of GPS, all of those things that we have done, we've demonstrated that we are an incubator for innovation that has promoted efficiency, which is the equivalent of sustainability,” he said.

The EPA also attributes reduced emissions over the last few years to the “accelerated retirement of older, less fuel-efficient aircraft.” That is true for airliners, but the average age of business aircraft in the U.S. has averaged nearly two decades for several years. According to a recent analysis by Airbus Corporate Jets, the average age is 18.5 years.

By KERRY LYNCH • Editor, AIN monthly magazine
March 4, 2024

Preowned business jet inventory soared by 32 percent year-over-year in February, while prices softened by 5 percent, according to financial analyst Jefferies. Citing data from Amstat along with its own estimates, Jefferies said the increased inventory crossed all segments with available heavy jets up by 37 percent, medium jets up by 32 percent, and light jets up by 28 percent.

Inventories of jets less than seven years out of production have increased by 35 percent year-over-year. However, the available inventory, at 4.3 percent of the business jet fleet, is still below the five-year average of 5.1 percent, Jefferies reported.
Overall, 1,094 business jets were available for sale in February, compared with 1,078 units a month prior and 831 in February 2023. The 2023 figures were near lows.

Inventory of in-production Dassault Falcons saw the biggest jump last month, up 80 percent from a year ago, Jefferies reported. However, this is from a small base with a total of 18 aircraft for sale. Meanwhile, Cessna Citation inventory climbed 49 percent year-over-year, with 104 units for sale. Jefferies said the Citation Mustang drove the increase.

Bombardier inventories were up 45 percent to 58 aircraft. This was a result of an 86 percent jump in Challengers on the market, which numbered just seven a year ago. Gulfstream inventories increased 33 percent, to 69 jets, including 13 G650s. Jefferies also noted that Amstat numbers show that the Savannah, Georgia manufacturer has now produced 53 G700s, implying 46 for customers.

Conversely, Embraer inventory shrunk by 16 percent, to 26 business jets, with a dwindling number of Legacy 650s and Phenom 100s for sale.

As for pricing, while down 5 percent from February 2023, it ticked up a point over January. The Dassault fleet marked the only increase, up 7 percent year-over-year. The Falcon 900 series alone is up 59 percent. Gulfstream pricing is off by 12 percent; Embraer Executive Jets, -9 percent; Bombardier, -6 percent; and Cessna Citation, -3 percent.

The annual operating budget for your business jet requires careful consideration and forecasting. Here are some guidelines to help you accurately plan for the year ahead.

1. ESTABLISH DATA-BASED PROJECTIONS

Jet fuel. This is one of the largest line items in any aircraft budget. Fuel prices fluctuate regularly with the market and it is important to continually monitor these trends.

The locations you are flying to will help determine the average fuel price you want to forecast for. Will you be flying into Aspen (KASE), Teterboro (KTEB) or other locations with a higher cost per gallon? Or are you mostly flying from your home base to lower density airports which offer lower fuel prices? How often to you visit certain airports, and what is your historic fuel purchases at each?

Flight hours. How much do you plan on flying this year? The mission and frequency are important to understand so you can factor these numbers in your variable cost estimate.

2. ESTIMATE VARIABLE EXPENSES

Fuel costs. Unless you have specific details on your flight profile for the next year, you must estimate the average fuel costs you’ll encounter. This will be multiplied by the hours flown and fuel burn of your jet.

Program expenses. Engine and APU programs are calculated at an hourly cost. Multiplied by your estimated number of hours, this will provide you with an accurate estimate. Be sure to account for the minimum flight hours set by your program administrator.

Owner flight expenses. Use this line item to allocate costs associated with expenses related to travel with the aircraft. This includes landing fees, permits, deicing, catering, crew expenses, ground transportation, etc. Extensive international travel will increase this line item significantly, often by two-to-three times.

3. DETAIL FIXED COSTS

Management oversight. Do you utilize an aircraft management company? The monthly cost is typically outweighed by the fleet discounts and purchasing power you receive. This is seen by substantial savings on fuel, insurance, programs, subscriptions and training costs.

Facilities. Hangar, storage and fees associated with basing your jet at its home airport.

Crew costs. Here, you will want to include salaries, benefits and taxes related to the employment of your crew. This can consist of pilots, a director of maintenance, and flight attendants. Since 2018, there has been a shortage of pilots and maintenance technicians. Be sure to consult industry salary survey’s to ensure compensation and quality of life schedules are competitive in the market and adjusted for your geographic region.

Will you be utilizing supplemental crew throughout the year when your primary crew is on vacation or in training? If necessary for your operation, those expenses should be included here.

Maintenance. You want to budget for both scheduled and unscheduled maintenance costs.

Scheduled maintenance can be predictable by forecasting the inspections you have coming due. A management company or your maintenance shop can give you an idea of how much to budget for. Keep in mind, there is typically a fixed cost quoted for the inspection, then an hourly rate quoted to fix discrepancies (the problems they discovered during the inspection). Quite often, the discrepancies can be more costly than the inspection, so be sure to reference common discrepancy expense ranges for your make and model of jet for the scheduled inspection you have coming due.

Unscheduled maintenance is a line item you want to include for when the unexpected happens. This is harder to budget for. Most OEMs and management companies can help by giving you a range of what to set aside based on the make, model, and age of your aircraft.

Wi-Fi. High-speed internet, specifically streaming Wi-Fi, is more and more common on aircraft and is expected by most charter clients for Part 135 operations. Depending on the equipment installed and the subscription plan, this can vary by tens of thousands of dollars. A proper review of your prior years data consumption and current data plan is a wise analysis to ensure you have the right plan to fit your connectivity needs.

Insurance. Don’t cut costs here. You will want to find a good insurance agent or pair up with a management company for their buying power. The two largest variables to any insurance policy is your declared hull value, and limit of liability. Carrying $250M in liability is a common coverage to provide adequate protection for you.

Charts, manuals, subscriptions. This is a catch-all for the miscellaneous line items that can add up fast to significant amounts. Again, this will vary by the size and type of aircraft. If you have been in operation for a few years, you can use the previous year to get a good idea of what this will cost you, then make adjustments based on any changes being considered. If this is a new plane, consult with a management company for common expenses they are seeing on other aircraft in their fleet.

Sustainable Aviation Fuel (SAF) and Carbon Offsets. Sustainable Aviation Fuel or SAF is now available at 35 airports in the United States and growing. SAF is produced from various sources including animal fats or recycled materials and can reduce the carbon footprint of your aircraft by about 20%. Currently the green premium is $1.50 to $2.00 more per gallon of Jet-A. Include this in your annual budget if you plan to incorporate SAF into your carbon reduction strategy. Also Carbon Offsets are becoming a common purchase and average around $0.10/gallon. Inquire with your Aircraft Management company or fuel provider for more information.

FINAL THOUGHTS TO CONSIDER.

There is a lot to take in here. Take this step by step and understand what all goes into operating the aircraft. Speak with your pilots, maintenance tech or management company to understand the costs. If this is your first year in operation, you may find a large spike in the budget right off the bat. This is due to the startup costs associated with pilot training, tooling and insurance.

Need help creating a yearly budget for your business jet? Reach to the Management Experts at Flight Solutions, Inc. Let our 32+ years of experience work for you!

This email address is being protected from spambots. You need JavaScript enabled to view it. or call our Team at (615) 452-5001. www.flightsolution.com.