Is Business Aviation Poised for Recovery in 2012?

 - January 3, 2012, 3:30 PM

Two business aviation analysts told AIN that positive economic fundamentals–including strong profits and record-high stockpiles of cash on hand at companies–could lead to “some kind of upturn” for the industry in 2012 relative to last year, despite U.S. political gridlock, Euro-zone economic woes and continued unrest in the Middle East. Teal Group analysis vice president Richard Aboulafia is cautiously optimistic that the business aviation market will rebound in 2012: “A quarter or two of good news could open the purse strings and give us a good second half of the year…[but] there are many exogenous events that could quash” any such recovery. Meanwhile, Brian Foley Associates president Brian Foley said some business aviation segments–including FBOs, MROs, charter and fractional, as well as large-cabin jet sales–“have already been showing steady recovery.” He also believes that the turboprop market turned the corner last year, leaving only the light and midsize jet segments yet to recover. “Those segments that haven’t [turned the corner] yet always seem to garner top attention, which leads some to conclude that the entire sector is still teetering,” Foley said. “Looking ahead, we don’t see 2012 being significantly different from 2011. Growth and stabilization will continue, with the inevitable bumps along the way.” That said, he predicts that 807 business jets worth $20.3 billion will be delivered this year, surpassing both volumes and billings for each of the last two years.