UBS Investment Research’s January 6 business jet update indicates that flight activity, measured by takeoffs and landings, was 10 percent lower in November on
Business jet flight activity last month fell 19 percent from the same period a year earlier, although that was better than November’s 25-percent drop-off, according to a business jet market report issued this morning by UBS Investment Research. Flight activity for the entire year was off nearly 12 percent compared with 2007. About 86 percent of the flights UBS tracked last month were U.S. domestic flights and the remainder was international.
UBS Investment Research’s business jet survey released late last month shows a contracting market index that is “reflective of a market that continues to rapidly deteriorate.” According to UBS analyst David Strauss, “We believe this [is] a market with few serious buyers, too much supply and pricing that has fallen 25 percent or more over the past six to eight weeks.” A lack of financing is also endangering aircraft manufacturers’ backlogs, UB
UBS Investment Research’s Business Jet Survey that was released today is a sobering account of the recession’s toll on the U.S. bizjet market. The firm’s “business jet market index” came in at 14 this month, slightly higher than last month’s all-time low of 13 but still well below 50, which is the dividing line between market growth (above 50) and contraction (below 50).
A recent J.P. Morgan report reassessed the effect of the acquisition of Jet Aviation by General Dynamics “in light of the tough business jet environment.” For 2009 and 2010, the report said, “We are now looking for sales [at Jet Aviation] of $1.4 billion in 2009, a bit below GD’s guidance for $1.5 billion, which had been our prior estimate.
According to a UBS Investment Research report issued yesterday, the business jet market “is deteriorating at an accelerating rate” as pre-owned inventory continued to rise, flight activity fell and sales slowed last month. Worse yet, business jet financing appears to be drying up, threatening backlogs.
Business aviation consultancy Brian Foley Associates believes the peak for business jet backlogs likely occurred in the third quarter and will now begin shrinking.
Pre-owned business jet inventories rose by 10 percent last month and are now 57 percent above year-ago levels, according to a report issued yesterday by UBS Investment Research. “Used inventories have been building steadily since the end of 2007 and in October reached a fourth consecutive all-time high at 2,564 aircraft,” noted UBS aerospace analyst David Strauss.
UBS Investment Research’s business jet report–released yesterday–shows that business jet flight activity was 13 percent lower last month compared with the same period last year, although the data was slightly better than the 18-percent year-over-year decline in August. Year-to-date, flight activity is down 9 percent.
The NBAA Convention in Orlando, Fla., which concluded yesterday, attracted 30,811 attendees, just shy of the 30,963 people at the event last year in Atlanta. It was a “solid turnout” given all the circumstances, in the opinion of association president and CEO Ed Bolen. “This year's show comes amid spikes in the cost of fuel, tightening credit markets and a challenging economy.