UBS: Bizjet Market Strong Despite Lower Flight Activity

 - August 28, 2008, 11:50 AM

In UBS Investment Research’s business jet update released on Tuesday, industry analyst David Strauss noted that U.S. business jet flight activity last month declined 11 percent from the same month last year. According to Strauss, business jet “cycles were 4 percent lower in July, on a rolling 12-month basis, and are 7 percent lower year-to-date, driven mainly by reduced charter activity, which was 9 percent lower in July on a rolling 12-month basis, and 12 percent lower year-to-date, while all other business jet activity (including military, freight and general aviation) was 2 percent lower on a rolling 12-month basis and is 5 percent lower year to date.” These numbers correlate with a 10- to 20-percent decline in jet-A fuel sales, according to an estimate provided by NBAA. Strauss said light jet activity has seen the largest drop this year, declining 10 percent through July. Midsize and long-range jet activity fared better, logging 3- and 5-percent decreases, respectively. Despite the drop in U.S. flight activity, Strauss said, “Still strong order activity would appear to indicate a business jet market that is holding up well.”