November 20, 2012
Business aircraft flight hours overall continue to stagnate, remaining a concerning indicator of market health. But, unlike aircraft sales, the strongest improvements are at the small end of the market, according to a special report from industry analyst Argus.
Flight hours have yet to recover from 2007-2008 levels, and overall are barely above where they were in late 2009-2010. Analysts look at the flat activity as a sign that the business aviation market still isn’t ready to improve. “Broken record alert: U.S. flight operations [are] flattish,” analyst J.P. Morgan says in its latest Business Jet Monthly report, adding, “While replacement could play a role in spurring new demand, we maintain that it is hard to see a U.S. bizjet recovery developing if usage is not growing.”
Flight hours in 2009 fell off by more than 25% from peak levels in 2007 and the first half of 2008, according to FAA data. By the end of 2009, flight hours started to recover, growing in the high single digits over the next year. For the 12 months between October 2009-September 2010, flight hours reached 3.727 million, according to Argus TraqPak flight activity data.
But since that time, growth overall has stumbled, up just 1.7% in the October 2010-2011 time frame and then down 0.8% in the most recent 12 months through October.
Over the past three years, flight activity has tended to peak in the March time frame. But overall, Argus says, there has been no clear pattern either up or down.
Large-cabin flight hours, which had been showing promise, dropped 4.9% in the past year, and midsize cabin flight hours also fell 1.4%
But operators appear to be favoring turboprop and small jet aircraft, which typically have much lower operating costs. Turboprop flights improved 1% in the past year and small-cabin jets are up 1.1%.
Flight hours have varied by type of operation, with the Part 91 owner flying more and the charter and fractional operator flying less in the past year. Part 91 flights were up 1.2% in the past year, after improving 2% in the 12 months before that. Nearly all categories of aircraft flew more under Part 91 in the past 12 months, except large-cabin jets.
Fractional operations, however, are still struggling, with flight hours dropping 5.9% in the past 12 months. This erases the 4% gains that fractionals made in the 12 months between October 2010-September 2011. All fractional aircraft types flew fewer hours in the past 12 months.