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What You Need to Know About the Current State of the Business Aviation Market

Global Jet Capital provides the latest insights on the business aviation industry.

The business jet market maintained healthy dynamics during Q2 2022. Business jet flight operations and transactions increased during the quarter, continuing an upward trend that started in the second half of 2020. OEMs again reported strong order activity that has increased backlogs across the industry and supported a strong pricing environment. While not reflected in the Q2 results, certain data points suggest a more difficult broader economic environment that may impact future quarters. The question remains, to what extent? With a unique value proposition, strong demand, and pragmatic behavior by the OEMs, however, today’s business jet market is quite resilient and should fare well even in an economic downturn.

Q2 2022 Highlights:

  • The global economy faced persistent inflation and rising interest rates in Q2. Any increased risk of broad economic decline, however, has been mitigated by a strong job market and low debt levels.
  • New users entering the business aviation market and established users returning to the market resulted in flight operations 20 percent above Q2 2021.
  • Strong orders drove OEM book-to-bill ratios to 1.8:1 in Q2 2022. With backlogs of $46 billion, OEMs have substantial cushion against any potential downturn.
  • Business jet transactions increased 14 percent in dollar volume in H1 2022 compared to H1 2021, driven by strong pre-owned activity and steady growth in new deliveries.
  • With demand strong and supply remaining at low levels, business jet bluebook values continued to increase.

The business jet industry continued to demonstrate healthy market dynamics in Q2 2022. New business aviation users who decided to forego commercial flights due to the COVID-19 pandemic remained in the market, while historical users have begun to return, leading to increases in flight operations. Demand for aircraft was also strong, driving up OEM backlogs. Despite an increase in aircraft listings, pre-owned inventory levels only increased slightly during the quarter. 

Challenges to the broader economy mounted during Q2, including inflation, rising interest rates, and economic contraction in some countries. As a result, economists are forecasting increased risk of a global economic recession. However, strengths in the business jet market, including high OEM backlogs and demand from new and returning users, have increased its resilience against a future downturn. 

View the Q2 2022 Market Brief at: https://info.globaljetcapital.com/quarterly-market-brief-q2-2022?utm_source=BJT&utm_medium=display&utm_campaign=BJT