Business jets keep rolling—year-to-date orders in 2005 are
up 11% over 2004—but the market is expected to peak in 2006-2007. After that
point, deliveries will probably dip.
These are the conclusions of the annual Honeywell Aerospace
business aviation forecast being released here at the NBAA Convention. The wave
of prosperity in the business aviation sector is continuing, just as it is for
the overall U.S. economy.
It's not that higher fuel costs, the devastation of New
Orleans and the Gulf Coast, and other factors haven't raised caution flags. For
example, the forecast anticipates slightly slower growth in the U.S. and world
economies in the near term.
But Honeywell's latest figures show a definite dip in
turbofan deliveries from 2006 into 2007, followed by a climb toward new heights
starting in 2008. Meanwhile, production plans for 2006 should reach an all-time
high, with backlogs this year expanding to more than 1,900 jets. First half
business jet deliveries in 2005 totaled 321 aircraft worth $5.5 billion, an
uptick of 35% in units over the previous year and 24% in dollar value.
Even though the sale of fractional shares was flat in the
first half of 2005 (after being up 24% in 2004 over the year before), jet card
sales and fractional share owner flying are putting a strain on overall fleet
capacity.
Honeywell expects 9,900 new turbofans valued at $156 billion
to be delivered over the next 10 years, according to Frank Daly, executive vice
president of marketing and product management. A healthy new product pipeline
will support long-term growth, and very light jets have the potential for
kicking the low end of the market into high gear.
In addition to the corporate jet forecast, Honeywell asked
600 general aviation operators about their interest in buying VLJs. The
results: In addition to the 800-900 very light jets that might enter corporate
service between 2005 and 2015, there could be a demand for as many as 3,700 to
4,600 additional aircraft for the owner-flown category. This excludes the
demand for this class of jets from air taxi and fractional operators.
