Plane Sales Likely to Lag Business Aviation Pick-Up
By Robert Evans, Reuters | May 04, 2010
Sales of jet and turboprop planes for the business aviation industry are likely to lag a sharp pick-up this year in operated flights because of continuing excess capacity, sector officials said on May 4.
The officials and industry analysts attending the annual European Business Aviation Conference and Exhibition (EBACE), said manufacturers were looking to the period from 2011 to 2013 for an upturn from the gloom of the past two years.
"There is every reason to believe that demand for business jets will begin to recover 10 to 18 months after a global economic recovery begins," Rob Wilson, president of Honeywell Aerospace Business and General Aviation, told EBACE Convention News.
David Marsh, head of forecasting at the European aviation safety organisation Eurocontrol, told Reuters there was plenty of spare capacity in the global industry's fleet that could be used before new plane orders were placed.
Major manufacturers displaying aircraft at EBACE, the industry's main international showcase, include Airbus Industrie, Boeing Business Jets division, Canada's Bombardier and Brazil's Embraer.
Bombardier, the world's No. 3 civil aircraft maker, reported in February that it had delivered 25 percent less business jets in 2009 than in 2008, but warned the weak economy would hold back orders and deliveries this year.
Flights Already on Rise
On May 3, Eurocontrol said that after a sharp decline in business aviation flights across the continent in 2009, largely sparked by the economic recession, they were up 5.2 percent so far this year and 11 percent in March.
Patrick Dunne of the U.S. National Business Aviation Association (NBAA) said the number of business flights in the United States -- the sector's biggest market -- was 12 percent higher in March than a year earlier.
Business aviation, which ranges from large and luxurious corporate jets through work-horse mid-range aircraft to air taxis and helicopters, accounts for some 8 percent of air traffic movements in Europe, and slightly more in the United States.
From the turn of the century the sector was recording year-on-year growth of some 10 percent, but this came to a halt amid global economic turmoil in 2008 and flights dropped by 14 percent in 2009.
Honeywell, which issued a revised edition of its 2009 market survey Business Aviation Outlook just before the three-day EBACE opened its doors on May 4, says Europe -- with a 27 percent share of the global industry -- will lead the revival.
According to the survey, sector operators in Europe have indicated that they plan to start new purchases earlier, perhaps from 2011, than their counterparts in the United States, the major global player in the industry.