Blog

With preowned aircraft inventories hovering at historic lows of 1.3 percent, asking prices continue to increase, rising 11 percent year-over-year, according to market analyst Jefferies Aerospace & Defense Electronics. Some brands are seeing prices skyrocket, led by Gulfstream, which is up 41 percent based on the strength of sales involving the G450 and G150, according to Jefferies.

Using Amstat data, Jefferies has introduced monthly research that tracks pricing fundamental for business jets. It noted that the estimated valuation of the preowned inventory is up 4 percent from February 2021. The aircraft valuation is based on average selling price adjusted for typical premiums and/or discounts, age of aircraft, upgrades, engine plans, and usage, providing an estimate for what the sales price of an aircraft should be. With regard to valuations, Gulfstream is leading the increase with the G280 and G650, each up 26 percent, while the G550 rose 29 percent.

Asking prices, however, are currently mismatched, up 13 percent over the average fleet valuation. This dynamic crosses most of the fleets with the exception of Dassault. “Embraer and Gulfstream ask prices in the used sales market appear to have the largest disconnect relative to estimated valuation with prices 28 percent and 27 percent higher,” the analyst reported. “Bombardier and Cessna average used market prices are 7 percent and 6 percent above estimated valuation…Dassault is relatively in line.”

Business and general aviation fixed-wing shipments began a recovery across the board last year, reaching a total of 2,630 units worth $25.2 billion, according to the General Aviation Manufacturers Association (GAMA). Releasing the global shipment totals during its annual State of the Industry press conference in Washington, D.C. today. GAMA reported business jet, turboprop, and piston/electric deliveries for 2021 were up 222 units from the 2,408 in 2020. As a result, billings for these aircraft rebounded to $21.6 billion last year, compared with $20 billion in 2020.

In addition, helicopter shipments are up significantly year-over-year, even without Leonardo yet reporting year-end totals (Leonardo typically reports its results in March). Helicopter shipments had leaped by 25.3 percent, to 826 aircraft, and billings by 28 percent, to $3.7 billion, in 2021, the association reported.

The totals, GAMA president and CEO Pete Bunce noted, are “converging on figures that were seen before the outset of the pandemic.”

Business jet makers handed over 710 aircraft last year, marking a 10.2 percent jump from the 644 delivered in 2020 when the pandemic had initially halted activity and then dampened sales. However, while still ongoing, the pandemic had a different effect last year, pushing new buyers into the industry and helping to propel sales. Most of the business jet OEMs reported increases in 2021, with the exception of Gulfstream and Dassault, and nearly all that provided book-to-bill details saw yearly increases that were well above 1:1, with some closer to 2:1, pushing up backlogs.

Turboprop deliveries, meanwhile, reached 527 units in total, a 19 percent jump from a year earlier when 443 aircraft were delivered.
Light aircraft edged up from 1,321 units to 1,393. For the first time, GAMA reported this category as piston and electric, reflecting the entrance […]

Despite a fourth-quarter that saw fewer aircraft deliveries year-over-year, Bombardier beat guidance last year with revenues and earnings up 7 percent and 220 percent, respectively, as business jet shipments totaled 120, the company reported this morning. Further, the Montreal-based manufacturer is making plans to ramp up deliveries “a tiny bit” this year and by as much as 15 to 20 percent in 2023.

In a call with analysts, Bombardier president and CEO Eric Martel called 2021 a year of “planning, execution, and prudence” as the company moved forward as a pure-play business jet manufacturer. He also expressed encouragement that the company succeeded in all of its goals: turning the Global 7500 into a revenue “accelerator,” expanding its aftermarket presence with $1.2 billion in revenue, deleveraging its balance sheet with interest expenses cut by $250 million, and remaining on target with its cost-reduction goal of $400 million by 2023.

In the quarter, Bombardier delivered 38 business jets, down from 44 a year ago, with large aircraft deliveries sliding by 10 units, to 18. Meanwhile, Learjet deliveries were cut in half to two units as the company winds down its light jet programs. Martel reiterated that the final three Learjets are to be handed over this year.

As a result, fourth-quarter 2021 business jet revenues dropped by $500 million, to $1.7 billion. But adjusted earnings swelled from a $1 million loss in fourth-quarter 2020 to a $232 million gain in the most recent quarter.

Martel explained that in the fourth quarter the results were a little unusual because the onset of the pandemic—and the associated travel restrictions and factory stoppages—had caused a shift in deliveries toward the end of 2020, thus making for a really strong final quarter that year. “2020 was a little […]

Global business aircraft flight activity was up 32.6 percent from January 2021, according to Argus International’s January 2022 Aircraft Activity Report. The North American market recorded a yearly gain of 22.7 percent while Europe jumped 73.4 percent, based on TraqPak data that tracks business aircraft IFR flights.

In North America, all categories saw yearly increases of at least 20 percent with Part 135 operations leading the way at 23.2 percent. Part 91 flights followed with a 22.6 percent increase while fractional activity rose 21.1 percent.

Among aircraft types in North America, activity gains were the highest among large-cabin jets, up 39 percent from January 2021. Midsize jets recorded an improvement of 25.8 percent and light jet activity increased 22.7 percent year-over-year. Turboprops were up just 12.5 percent.

Year-over-year large-cabin activity surged 142.3 percent in Europe with midsize jets following at 68.1 percent. Light jet and turboprop activity in the continent was up 63.6 percent and 27.7 percent, respectively.

Other regions of the world recorded more than 51,000 flights in January and overall activity for the year was up 57.4 percent.

With a surge in the latter half of 2021, business aviation flight activity in North America sailed past 2020 levels by 40.9 percent and eclipsed pre-pandemic results in 2019  by 7.2 percent, according to Argus International’s 2021 Business Aviation Review. “We ended 2020 saying that it was a year unlike anything we had before and now we wrap up 2021 with the same thought but in a dramatically different way,” Argus reflected in its 2021 overview of TraqPak data, which tracks IFR business aircraft flights in North America.

While flight activity was up almost 41 percent year-over-year, flight hours similarly were up 42.3 percent from 2020 and 10.3 percent from 2019. These gains came primarily in the latter half of the year.

A slow January and February kept first-half flight activity down 1.2 percent from 2019 levels, even while up 42.8 percent from the first half of 2020, when much of the world paused in the early days of the pandemic. By March, however, flights edged past 2019 levels by a total of 19, Argus said, noting, this was the beginning of nine straight months exceeding 2019 activity.

Fractional operations saw the biggest bounce, with the number of flights up 51 percent and hours 48.9 percent higher in 2021. Part 135 activity increased by 44 percent and hours 46.5 percent over 2020 levels, and Part 91 flights and hours saw gains of 35.4 percent and 37 percent, respectively.

Argus, however, called Part 91 operations “a work in progress,” noting that it was the only of the three categories not to exceed 2019 levels for the year.

Large-cabin jets saw the greatest year-over-year increase in terms of flight hours, up 54.3 percent, while midsize jets climbed 48.3 percent and light jets […]