WINGX’s weekly Business Aviation Bulletin.  

Summary

Business jet activity now appears to have realigned with flight activity in 2022, suggesting that demand has now found an equilibrium after deflating in the last 12 months in comparison to the Covid-related surge. The buoyancy in Europe appears to be leisure-oriented. In the US, strong demand for ultra long range aircraft is evident. Geopolitical crisis in the Middle East could destabilize the industry in the next few months. In the shorter term, we would expect to see a short-term spike in charter flights in the region for humanitarian and logistics purposes.

Global

15 days into October, global business jet and turboprop activity is 1% up on of last year, 18% ahead of four years ago. For bizjets only, the year-on-year trend was up 2% compared to last October. Year to date (1st Jan – 15th Oct), bizjet flights are 4% below the same period last year, 19% ahead of the same period in 2019. Scheduled airline sectors are up 16% compared to October last year, narrowing to 7% behind 2019. Dedicated cargo operators’ activity so far this month is 7% down year-on-year, 6% behind 2019 levels.

Chart 1: Global fixed wing flights by sector, October 2023 (Note business aviation includes turboprops)

Europe

Bizjet activity in Europe is 3% ahead of October last year, 13% ahead of 2019, although 14% behind the highs of October 2021. France, UK, Italy and Spain are all lifting market activity compared to last year. Germany, Switzerland, Austria and Sweden are weighing the market down. Bizjet activity in Italy is widespread, Milan Linate and Ciampino airports seeing 18% growth compared to October last year, Malpensa and Pisa seeing 27% and 29% growth. Olbia and Leonardo da Vinci–Fiumicino are hitting new highs with 105% and over 400% growth vs last October.

Chart 2: Business jet activity by country, Europe, October 1st to 15th 2023 vs previous years.

North America

In Week 41, ending October 15th, North American business jet activity was up 5% compared to the previous week but 2% below the same dates last year. Through the first half of the month, bizjet activity is 1% ahead of October last year, 22% ahead of 2019. 6,806 bizjet departures so far this month make New York is the busiest metro area, activity ahead of the regional trend compared to last year. Los Angeles and Chicago airports are seeing declines in bizjet departures and hours compared to last year, elsewhere strong gains compared to last year at Washington and Nashville airports.

Chart 3: North America business jet departures and hours by city, October 2023 vs 2022.

Light jets are the most active aircraft type this month, also flying the most sectors, though 2% behind last year, 17% ahead of 2019. Three segments are flying more so far this October than in any previous October, with Ultra-Long Range jet sectors up by 51% compared to 2019. Heavy Jets have flown 2% more this October than last year, though slightly behind comparable 2021.

Chart 4: North American business jet aircraft segments, October 2023 vs previous years.

Asia

Business jet activity was up 13% in terms of sectors flown in the first 15 days of October this year compared to last year. Demand is being driven by Ultra-Long-Range jets, these fleets flying 27% more than last October, 38% more than 4 years ago. Midsize jets are on par with the start of October last year, although well ahead of October 2019. Bizliners are flying fewer flights than the start of October 2022, 2021 and 2019.

Chart 5: Asia business jet aircraft segments, October 2023

Middle East

Bizjet activity in the Middle East continues to trend ahead of comparable October 2022, sectors were 7% ahead, 54% ahead of 2019. Bahrain and Kuwait are well down on last year, although both still ahead of 4 years ago. Qatar is seeing strong gains compared to the start of every October in the last 4 years, 243% growth vs October 2019. Business jet departures from Israel saw a notable spike on October 7th, sharply declining before returning towards the usual daily activity level for this month so far.

Chart 6: Business Jet departures from Israel, October 2023

Josh Coffman, GlobalAir.com

There is a growing buzz in the helicopter sales market, while business jet sales remain at a steady flight level. Those observations are among the conclusions found in the General Aviation Aircraft Shipment and Billing Report released by the General Aviation Manufacturers Association (GAMA) for the second quarter of 2023, released on Tuesday.

GAMA is an international trade association representing over 100 of the world’s leading manufacturers of general aviation airplanes and rotorcraft, engines, avionics, components and related services.

The report, based on a comparison with the same period in the previous year, indicates positive growth in various segments of the general aviation aircraft manufacturing sector.

Piston airplanes showed an increase of 11.4%, with a total of 713 units delivered. Turboprops experienced a more pronounced rise, registering a 17.4% increase and totaling 290 units. Meanwhile, business jets displayed a modest growth of 2.4%, with 296 units being delivered.

The overall value of aircraft shipments also saw an incremental gain, with the second quarter of 2023 witnessing a cumulative value of $9.2 billion in airplane deliveries—an increase of 1.4% from the previous year.

GAMA President and CEO Pete Bunce expressed measured optimism in light of these findings.

"The growth of our industry remains strong as manufacturers continue to deliver and take orders for new aircraft," he said. In a nod to the regulatory landscape, he emphasized the significance of stability, accountability, and a clear regulatory direction, especially within the United States.

Bunce underscored the importance of the FAA's role in this period of transformation for the aviation sector, highlighting the need for effective leadership. He also commended the bipartisan cooperation observed during the legislative process and expressed hope for the continued momentum in finalizing the FAA reauthorization bill. This, he noted, would enhance the agency's ability to ensure safety, drive innovation, and facilitate efficient regulatory procedures that support global aerospace leadership.

The report also shed light on the helicopter segment, which demonstrated noticeable growth compared to the latter half of 2022. Piston helicopter deliveries witnessed a robust increase of 28.7%, with 112 units delivered. Meanwhile, turbine helicopter deliveries recorded a substantial growth of 30.4%, with 339 units delivered. In terms of value, helicopter deliveries saw a collective increase of 29.9%, amounting to $1.9 billion.

The GAMA report comes on the heels of Global Jet Capital’s assessment of the second quarter and first half of the year.

The number of business jets available on the market is continuing to slowly increase, according to the latest report from Jefferies Equity Research. The 922 available aircraft this month represented a 59 percent rise from the near-record lows seen a year ago, with inventory now accounting for 3.6 percent of the total fleet, including all models and vintages.

According to Jefferies’ analysts, that inventory is still well below the five-year average of 5.6 percent. For aircraft currently in production or out of production for less than seven years, inventory increased by 93 percent year-over-year, standing at 2.9 percent of that segment.

While the number of aircraft on market has increased, so too has the pricing in many cases. The report also noted that average asking prices rose 15 percent from a year ago across most manufacturers, led by Cessna and Embraer (+23 percent). Bombardier (+20 percent), and Dassault Falcon (+14 percent).

Among the major five OEMs, only Gulfstream saw a drop in asking prices, which fell 6 percent. The report stated there were 17 G650s for sale with an average price of $49.4 million, a slight decline from the $51.5 million average last year. For the G550, inventory jumped from three in 2022 to 18 this year, or nearly 3 percent of the model produced, with the average list price down by 32 percent year-over-year.