After years of sluggishness, the business aviation industry is expected to improve noticeably next year, according to industry consultant Brian Foley. “I have a deep conviction that 2015 will be the indisputable pivot point when the industry, including its laggard segments, turns meaningfully upward,” he said. In early 2009, Foley accurately predicted “an impending nosedive” in the sector, which then saw order backlogs collapse, employment halved and a major aircraft manufacturer–Hawker Beechcraft–disappear.
Foley said the current industry metrics back up his optimistic outlook: pre-owned jet inventories are at their lowest levels since 2008; business jet flight activity is the busiest it has been in six years; the U.S. economic situation is “greatly improved”; and executives at business jet manufacturers are upbeat. “Add to that the lowest oil prices in four years, which reduces airplane operating costs, and historically low interest rates from which aircraft loan and lease rates are derived, and you’ve painted a great scenario for an all-encompassing rebound.”
A sustaining element, he said, is the number of new jet models being introduced in the near-term. Over the next five years, 18 new and derivative business jets will enter the market. “New products act as a sales catalyst, stimulating the market by giving customers a reason to buy,” he concluded.