The frenetic pace of the business jet market is starting to ease as COVID wanes and threats of a global recession loom. In an essay on the current trends provided to AVweb, market analyst Brian Foley says the COVID-spawned increase in bizjet sales and usage was bound to end, but a hopeful stat within that surge may not have the long-term benefit some had hoped. Many of those who bought up just about every fractional share, along with new and used aircraft, were new to private aviation and the hope was that they wouldn’t be able to give it up. That doesn’t appear to be the case, according to Foley.
Foley said the numbers are down across the board in the industry with noticeable decreases in new and used sales and fractional flights. He said it appears that’s largely the result of many of the newcomers returning to their pre-COVID travel habits and it will likely take another major upset like the pandemic to bring them back. “My estimate is that less than 10 percent of those new to general aviation will remain in the fold, which still favorably raises the baseline obtainable market for the industry from this point forward.”
Foley said the calming of the market is merely returning the industry to healthy historical norms and giving the stressed-out players a bit of a welcome break. “This is frankly a relief for an industry that was never scaled to be a mass transit system and has been overwhelmed over the last couple of years,” Foley writes.
No big surprise here. Owning and operating a business aircraft of any type is going to be more expensive than most people realize until they have been exposed to the reality. I believe economists refer to this as “regression to the mean”. It will be interesting to see how this may affect resale prices on our little bug-smashers, which have seen major increases in the past couple years.
It’s not just the money. Also, I suspect many people found out it’s just not all that. There’s a lot of people angry their boss can afford a fancier car that would, after a few weeks of owning that car, realize it’s just not that big of a deal. Make that a car that goes into the shop every few months, and they realize that warranties only cover the financial cost of repairs. That may be a dated example, but it makes the point.
It costs $10,000 per flight hour to rent a Praetor 600 from the local rent a jet company. Do those folks really care what it costs? Are they the same ones who buy their own personal flight transportation?
I have heard this also. But looking at my company’s schedule, I have yet to see much slowdown. And none of our owners have sold any of their planes that my company manages. So as the old aviation saying goes, I’ll believe it when the plane shows up in the hangar, or in this case disappears from the hangar and the ops spec is changed.