Annual business jet shipments could soon surpass 900 units for the first time since deliveries peaked in 2007 and 2008, according to industry analyst Brian Foley. He noted that airframers are seeing their orderbooks swell and backlogs grow thanks to a surge in demand for private aircraft spurred by the pandemic.
In 2008, the industry delivered more than 1,300 new jets, but following the Great Recession that figure atrophied to just half that amount annually—around where it still remains today. “But that’s all about to change,” he said.
Foley noted that business jet usage has rebounded to pre-pandemic levels as people seek safer travel in Covid times, which has also led to a surge in first-time private jet users. Meanwhile, preowned busines jet inventory has been picked clean due to an all-time high in transactions and corporate customers who hunkered down are now ready to replace their aircraft,
“By the first half [of 2021] most OEMs were reporting new jet orders outpacing shipments by a two-to-one margin, fattening depleted backlogs and giving hope that the long lost go-go days of the early 2000s may finally be returning,” Foley said.
While some segments of the industry rebounded quickly following the pandemic shutdowns in spring 2020, business aircraft manucturers are “late beneficiaries of the pandemic,” he noted. “For 2020, the industry actually had 20 percent fewer aircraft deliveries than the previous year, an anemic level not seen since 2004. This was brought on by a combination of factory shutdowns, supplier hiccups, and buyers waiting for economic confidence before plunking down millions on a new jet.”
While business jet deliveries this year are expected to be flat at approximately 700 aircraft, Foley believes that OEMs will ramp up production rates as they “gain confidence that the increased demand is real.” In fact, he expects the production pace to ramp up starting in 2022 and last for several years, with the 900-business jet delivery plateau being reached in the 2024 to 2025 timeframe.
“For now, business jet makers will continue to happily take orders while replenishing their backlogs, and will finally have the luxury to contemplate future production increases,” Foley concluded. “It’s a good time to be in the business.”