General Aviation Recovery Takes a Temporary Breather

 - June 8, 2010, 12:23 PM

Aviation market advisor Brian Foley said the current stagnant growth period for the general aviation industry isn’t cause for concern. “I see no cause for panic or even pessimism, certainly not at this point,” he said. “Most recoveries aren’t linear and the occasional pullback can be expected.” A year ago, Foley suggested that the recovery might be W-shaped, “And that appears to be what’s happening; the industry takes one step back before taking two more forward.” Economic troubles in Europe, the second-largest business aviation market in the world, likely explain the pause in recovery, he said. “Worldwide stock markets have responded with double-digit percentage drops. So how can any industry go unaffected, at least temporarily?” However, Foley doesn’t believe this will affect the industry’s long-term outlook. “Europe and the markets will adjust themselves–they always do–at which point the recovery can resume in synch,” he noted, adding that this slowdown “will be shorter lasting and less pronounced than the big recessionary downturn of 2008 to 2009.” But the timing couldn’t be worse, since many of the companies affected were just beginning to show improvement. This could possibly lead to more summer furloughs at aircraft manufacturers, he said, “but then the recovery should resume on a steadier, upward trend.”