Coming Months 'Crucial' for Bizjet Makers, Says JPMorgan

"Elevated used inventory, attractive used pricing and macro uncertainty continue to hold down demand for new business jets," according to JPMorgan Equity Research's latest business jet monthly report. As a result, said the report, manufacturers "are eating further into their backlogs, and if these don't stabilize in the coming quarters, further [production] rate cuts seem likely." However, the risk is not the same across all categories, with demand for large-cabin jets continuing to outpace that for light jets by a "striking" degree.

As for preowned jets, JPMorgan said used inventory of in-production models increased 11.8 percent in August versus 11.6 percent in July, with all categories showing a rise in inventories. However, the firm blamed this on "a bump in the road" and said it expects inventories to "continue to decline gradually." Meanwhile, average asking prices for preowned jets increased 1.3 percent in August, reaching $11.4 million and JPMorgan reported that business aircraft flight activity for July was up 7.7 percent from the same month in 2009.