Since the COVID-19 pandemic devastated air traffic levels, only two sectors of the global aviation market – air cargo and business aviation – have managed to get back on track. A steady recovery has been marked by a sharp increase in private jet deliveries along with a surge in aircraft orders across the industry’s top Original Equipment Manufacturers (OEMs) for the first half of 2021. AeroTime investigates how the business aviation sector is recovering and looks at how many new aircraft the industry may need post-pandemic.

Recovery led by changes in the dynamics of the global aviation market

According to the latest Eurocontrol data, the demand for business and private aviation services is showing signs of steady recovery. In 2020, business aviation usage recorded a 5% growth in demand compared to pre-COVID levels in 2019, but current trends suggest that 2021 will witness close to a 50% increase in flight hours.

The real recovery of corporate aviation in Europe started in July 2021, when the demand for flights overcame pre-pandemic levels. Analysts at the European air traffic management organization calculate that, since August 2021, air traffic has stabilized at around 30% above 2019 levels with more than 2,720 daily flights on average between August 2021 and September 2021. By comparison, around 2,180 flights were made during the same period in 2019. 

Eurocontrol says that, to date, the percentage of the business aviation market share in Europe increased to 13% between January and September of 2021, compared to 6% in the same period in 2019. 

So, what’s behind the recovery of business aviation? Well, it’s partly due to global air travel restrictions and operational limitations for commercial airlines which resulted in the reduction of commercial flights. During the pandemic, some commercial aviation customers turned to corporate aviation flights because the connectivity they wanted was not available. The convenience of flying privately as well as new services, such as shared flights, started to attract new customers to business aviation.

Furthermore, analysts forecast that the demand for corporate aviation services is likely to continue to enjoy steady growth.

Industry faces a rise in demand for both new and used private jets

According to the Global Business Aviation Outlook, which was released by the US aircraft engine and avionics manufacturer Honeywell Aerospace in October 2021, to cover the surge in demand for private air travel, the business aviation industry will take up to 7,400 new jets with deliveries reaching up to $237 billion between 2022 and 2031. Such figures indicate a 1% rise in deliveries in comparison to the same 10-year outlook, which was made in 2020. 

As for a shorter period outlook, carriers will potentially face a sharp increase in demand for both new and used business jets in the operational environment post-pandemic, Honeywell Aerospace analysts say. Honeywell estimates that, in terms of aircraft built, business jet deliveries in 2022 should rise globally by around 10% in comparison to 2021 levels. It also estimates that around 72% of new deliveries, which are expected to be completed in the upcoming five-year period, will consist of new larger-cabin business jets. 

Meanwhile, the used business jet market should also see a trend of significant growth in demand. By 2026, carriers worldwide are expected to replace or expand around 29% of their current fleet with used business jets, reflecting a 4% higher demand for used aircraft compared to the 2020 predictions. This means that operators could take more than 6,500 used business jets over the next five years.

Differences in the demand for new jets in various regions

Although global forecasts appear promising, the implementation of various carriers’ plans regarding the purchase of new jets and the renewal of their aging fleets have varied depending on the severity of their regional air travel restrictions.

For instance, the latest Honeywell data suggests that airlines operating in Europe, where the Delta variant forced governments to apply harsh air travel restrictions, will acquire 5% fewer private jets in the next five years than was forecast in 2020. Expectations regarding potential aircraft purchase in the region have dropped to roughly 19% of the global business jet fleet, meaning that operators will likely renew their fleets significantly slower than previously thought. 

At present, around 23% of European airlines offering private flying services plan to purchase new jets within five years. This percentage comes below the global average of 29%, Honeywell says.

Meanwhile, compared to forecasts made in 2020, five-year new jet purchase plans in the North American region have also shown a slight decrease. Honeywell predicts that, over the next five years, North American carriers will purchase 3% fewer private jets in comparison to the previous year’s forecast. Honeywell estimates that 13% of a total fleet serving the region will be replaced by newly manufactured jets in a five-year period. Around 35% of airlines are expected to schedule their new aircraft orders within the first two years. By 2021, it is predicted that operators in this region will lead global demand for new private jets.

Despite ongoing geopolitical and commercial tensions, Asia Pacific is considered to be one of the regions with the most ambitious plans regarding the purchase of new private jets. Here, it is forecast that airlines will replace at least 15% of their fleets within five years. Based on the expressed level of fleet renewal plans, Asia Pacific should represent around a 12% share of global new jet demand over the next five years, Honeywell predicts.                                                    

In the meantime, Latin America is projected to replace or supplement around 21% of its fleet with new business jets. In terms of new aircraft purchase plans, carriers have already recovered to 2019 levels. Honeywell has calculated that, compared to the outlook made the previous year, airlines are expected to purchase around 6% more jets in the next five years. Around 29% of these projected purchases are planned to happen between the end of 2021 and 2023. Over the next five years, the region will likely represent 5% of the global forecasted demand for new business aircraft.

When it comes to business jet acquisition plans in the Middle East and Africa regions, only 9% of providers of private flying services are expected to renew their fleets with new jets, down from 16% projected in the 2020 outlook. Only 13% of airlines serving these two regions plan to buy new aircraft within 2027, down from 46% compared to last year’s forecast.

As for the longer-term forecast, Honeywell analysts project that, in line with the expected global economic growth through to 2031, the global growth rate of business jet deliveries should increase by 3% annually on average.