The latest UBS Business Jet Market Index jumped 10 percent from the August survey as respondents noted healthier pre-owned business jet inventories and improved pricing, as well as higher customer interest. Now at 53, the index score returns to its post-U.S. election high and denotes an improving market.
By cabin size, midsize jets took the lead with an index score of 54, up 7 percent sequentially. This was followed by light jets at 53, a 15 percent increase, and large-cabin jets at 51, which climbed 12 percent from August. UBS Global Research said the straight-up measure of absolute business conditions came in at 5.4, up 5 percent from the previous survey and the highest since before the financial crisis.
According to UBS aerospace analysts David Strauss and Darryl Genovesi, the overall index reflects an improved view of pre-owned aircraft pricing and inventory, with those scores soaring 24 percent and 22 percent, respectively, along with higher customer interest, which rose 11 percent. North American customer interest increased 11 percent and remains strongest at a score of 70, followed by an “improving” Europe (56), while Asia (51), Latin America (48) and the Middle East (47) “appear stable to slightly improving.”
“Respondent commentary was generally optimistic on lower young used inventory levels and improved utilization trends, although used pricing is still seen as declining, albeit at a slower rate,” the UBS analysts said. “In addition, commentary suggests improved trends not yet seen translating to new markets. The Zetta Jet bankruptcy was highlighted as risk.”