Analysts Say Bizav Industry Will Grow This Year

AINalerts » January 8, 2013
Current market indicators suggest that the business aviation industry can look forward to growth this year. (Photo: Gulfstream)
January 8, 2013, 4:00 PM

The business aviation industry appears poised for growth this year as the U.S.“leads the way” to a fuller recovery, according to two analysts contacted by AIN. Teal Group vice president of analysis Richard Aboulafia is “cautiously optimistic” that business jet deliveries and billings will climb this year, while Brian Foley of Brian Foley Associates is more bullish.

Both analysts cite several key leading indicators that continue to trend in positive directions as the reason they see growth for business aviation this year. These indicators include lower used business aircraft inventories, rising aircraft utilization, increasing worldwide GDPs, strong stock markets, record corporate profits and continuation of low U.S. taxes.

“The year will continue to build on last year’s progress,” predicts Foley. “Despite fiscal cliff uncertainty during the first half, the industry’s primary U.S. market will lead the way. In all, the upswing will last until the next down cycle in 2017. Industry participants have the next four years to claw back and prosper.”

According to Aboulafia, “If the U.S. economic recovery continues to gather pace and the business community starts [perceiving] more opportunities than threats, we could see a stronger-than-expected U.S. market recovery. This could precipitate the delayed replacement cycle we need to revitalize the small and midsize cabin segments.” Overall, concludes Aboulafia, “We’ll see some kind of deliveries uptick this year.”

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