NBAA: A look back at past shows

The static display at NBAA 2013.

After much waiting, NBAA 2014 should finally be an upbeat show – and many thought that would come faster as our reviews of the last three NBAAs conventions (first published in our One Minute Week newsletter) show below:

NBAA 2013 – Las Vegas

NBAA 2013 will not be remembered as a standout show. There were not the crowds of 2007; in fact, just 275 more people – a total of 25,425 – attended the show, when compared with last year’s event in Orlando.

But, more importantly, brokers, manufacturers, engine programme companies and others all said that there were a good number of buyers, flight departments and decision-makers at the show (many brokers actually said they wished they could have brought more aircraft to the static display at Henderson Airport).

The highlight was the launch of Dassault’s Falcon 5X, a genuinely exciting new aircraft that has something for everyone. Passengers will enjoy the skylight, fresh interior and wide cabin; financiers and buyers will like the 12 year warranties; and pilots and engineers will appreciate the innovative wing and other technological developments (that have been subsidised by the OEM’s military aircraft). The $45 million aircraft is due for delivery in 2017.

Another exciting launch was Wheels Up, with Beechcraft delivering the first of up to 105 King Air 350i aircraft to Kenny Dichter’s new private aviation company. Dichter, who also created Marquis Jet, told Corporate Jet Investor that he wants to “further democratise” business aviation. This is not just hype; few companies have done as much to sell the benefits of business aviation as NetJets and Marquis Jet. With its turboprop aircraft, Wheels Up will be targeting a whole new group of customers.

Wheels Up has also agreed joint ventures with jet operators like JetSuite and VistaJet (where it is its exclusive US sales agent). JetSuite has an amazingly strong entrepreneurial team including the founders of JetBlue, Gol and Zappos, the US distribution company. But it will be really fascinating to see what happens when Dichter and Thomas Flohr join forces.

NBAA 2012 – Orlando

A lot of emphasis gets placed on the number of people attending business jet conventions and 25,250 was the figure of unique visitors that NBAA registered for its 2012 Convention in Orlando. So what does it tell us?

First, it is a lot of people. Whilst it is easy to be negative about business aviation it is worth remembering that the global fleet is still growing. NBAA continues to be a really useful show and the biggest business aviation event in the world.

Second, the event had about 750 less delegates than 2011. Some of this was due to Hurricane Sandy – although NBAA is not sure what effect it had. The organisation says that about 200 people (less than 1%) cancelled their registration citing the hurricane. The rest may not have been able to log on to cancel.

Third, NBAA 2012 was the third lowest attended NBAA event in the last 10 years (after 2009 and 2010). It is still 20% down on the average attendance between the late 1990s and 2008. This is not unique to business aviation. Lots of trade shows have falling attendance and based on the square footage of exhibition space NBAA 2011 was the fifth largest trade show in the US according to Trade Show Executive magazine.

But really it tells us very little. The quality of attendees is more important than the overall number and as our analysis of the last 10 year’s shows there is little relation between delegate numbers and overall industry health.

They don’t also give the mood of the event which, in my opinion, was realistic but distracted. Not surprisingly, many of the attendees were watching the horrific effects of Hurricane Sandy. The rest were focusing on the US presidential elections. The big story this week will (hopefully) come on Wednesday when we find out who the next President of the US is.

Everyone seemed resigned to at least another tough year for the market. Senior management at all the other manufacturers had similar views, but Bill Boisture, chairman of Hawker Beechcraft, summed it up best.  “I can’t predict when the upturn will come,” he said, “But I can tell you that it won’t be in the next 12 months.”

NBAA 2011 – Las Vegas

Two more years. The general consensus of a well-attended NBAA 2011 is that it will take two more years before the business jet market truly picks up.

One trader says buyers are waiting until the US presidential election in 2012 to get more certainty on taxes and government attitudes to aviation. Large cabin aircraft are still faring better, but traders say that pre-owned prices for these aircraft are not accelerating back and, apart from Asia, new orders are drying up.

Honeywell seemed to agree with this sentiment and dropped 100 jets – mainly smaller aircraft – from its annual 10 year business jet forecast. It expects 600-650 new business jets to be delivered this year, 15% down from 732 in 2010. Honeywell expects just under 700 new aircraft will be delivered in 2012. So this hopefully means that 2011 will be looked back on as the low point of this cycle.

Most people agree with Honeywell that that 2012, which had been seen as the year when the market would bounce back, will be fairly similar to 2011. While this is frustrating, it is not dreadful. Manufacturers, brokers, lawyers , banks and others have restructured to survive in a quieter market so will cope. And, if you need more cheering up, Honeywell and others still forecast that the total business jet fleet will double in the next 10 years. Two years really is not long and it means the upturn will start just when the show returns to Las Vegas.