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NBAA-BACE Newsmakers panel talks bizav aircraft market, future trends

A panel of aviation analysts gathered at the Media Day Newsmakers Luncheon before the official opening of the 2023 NBAA-BACE to discuss their unique perspectives on the business aircraft market and its influences moving forward. Most industry forecasts are calling for a continuation of steady bizav growth for the near future. Sheila Kahyaoglu, the managing director and aerospace analyst at Jeffries, said the ongoing supply chain issues are a reason for the company's more subdued expectations. "Our 2024 forecast is only 5% above 2019 levels, which was basically where 2013 was," Kahyaoglu said. "The industry has not really grown over the last decade." "The industry was basically dead in the financial crisis until 2018," said Ron Epstein, senior aviation analyst for Bank of America. "We then saw a real recovery in earnest until COVID happened, and then industry got quite hot. And now you're just normalizing back to where the industry was back in 2018. Just a normal recovery, the way it should have been." While many in the industry have focused on the growth driven by new users, longtime business aviation analyst Rollie Vincent opted to downplay the influence of industry members stating they would avoid airlines and stick to using business aviation. "People will continue to fly privately where it makes sense," Vincent said. "It's not black or white. I know an [entrepreneur] with a couple of Gulfstreams in the hangar, who hops on commercial flights when he goes to Denver or Dallas. People may say they've flipped a switch, but the rational person will choose the best option for their needs." The panelists also addressed future trends, like the role sustainability is playing in new industry developments. Session moderator Richard Aboulafia of AeroDynaic Advisory asked the panelists about a mismatch between "the kind of new product investments that we know stimulates demand" at the lower end of the market and with manufacturers' continual focus on a more profitable and larger-cabin intercontinental aircraft. "In any other industry we cover, six product introductions over a course of a year and a half would [lead us] to short the segment," Kahyaoglu said. "Everybody loves the heavy end of the market, though, so that's where we see the most growth." "The way to see more innovation at the lower end of the market is [to adopt] business models and technologies that allow that to happen," Epstein said. "Electric propulsion may be able to help with that, but companies will deploy their capital where they see the best return." The varying demographics in the industry will also play a role in influencing the market. Vincent said that the significant growth in interest from the under-40 segment has expanded charter options and the development of hybrid electric propulsion. Vincent noted that charter option expansion and hybrid electric propulsion development are two aspects of aviation that older industry personnel do not consider key drivers, based on his company's polling. "Hybrid electric is coming," Vincent said. "Ask the engine companies, they're investing really heavily there. It's going to help us on our technology roadmap to get to [zero-carbon emissions] by 2050. After that will come all-electric in our sectors, but I don't think it's coming for 25 or 30 years." Reaching these goals requires the input of fresh talent and new ideas into the aviation industry. "We solve our problems by technology," Vincent said. "We need to bring more talent to this industry and get them excited about all this technology that brings people together."2023 NBAA-BACE CoverageHonda Aircraft launches aircraft management program to streamline ownership, maintenanceAvfuel boosts SAF supply availability, introduces sustainable program for NBAA-BACEACJ TwoTwenty makes NBAA-BACE debut Cessna Citation CJ3 Gen2 announced at NBAA-BACE, Textron names first customerDaher celebrates 500th TBM 900-series deliveryBoeing to offer new buying process, interior options with new BBJ SelectHondaJet Echelon unveiled at NBAA-BACE as a light jet that can perform like a midsizeBombardier reveals EcoJet phase 2 testing progressFAA, NTSB leaders headlining panel at 2023 NBAA-BACEJSSI launches PartsHub at 2023 NBAA-BACE
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