‘Carbon Tax’ Could Choke Bizav Growth in Europe

 - July 7, 2011, 10:20 AM

The European Union Emissions Trading Scheme (EU-ETS) could add yet another obstacle to business aviation’s anemic recovery, according to business aviation analyst Brian Foley. “Worldwide business jet deliveries were already down by 40 percent in just two years. Now, in a continued slow aircraft sales environment, would-be buyers are being asked–told, really–to spend time sorting through all the implications of ETS compliance, thus delaying the sales process,” he said. The EU-ETS “carbon tax” begins in January and will apply to most business jet flights to, from and within European airspace. Yet even before ETS takes effect, its impact is already palpable, Foley noted. “Earlier this year we were forced to lower our 10-year forecast of business jet deliveries to Europe from 25 percent of worldwide production to just 20 percent,” he said. “There’s an evident pattern of expanding taxes and regulations there, including ETS, that will limit that region’s future growth potential” for business aviation. “These costs and uncertainties can only act as a disincentive to own or purchase a business aircraft,” Foley concluded.