So that was 2018 – the year in review
New Year is fast approaching, but it is worth looking back on 2018 before it is over. On the whole it was a good year for business aviation. US buyers dominated causing the number of pre-owned aircraft available for sale to fall significantly and more people flew than ever before.
As always, after the rush of 2017’s December deliveries, 2018 started slowly. At Corporate Jet Investor London the mood was upbeat but not crazy. But there were already clear signs that President Trump’s 2017 Tax Cuts and Jobs Act – particularly changes to depreciation on both new and pre-owned aircraft — was encouraging buyers into the market.
But while the US was upbeat, the news from other regions was less cheery. Most European aircraft buyers only woke up in the middle of the year and buyers in Brazil and Mexico waited for election results. But the Middle East was perhaps the toughest market with two of the key markets effectively closed. Saudi Arabia’s blockade of Qatar continued, making flights to and from that country difficult. The Kingdom itselfsaw little activity following a so-called anti-corruption campaign that led to aircraft being grounded and handed over to the government. At CJI Dubai, operators stressed they were in the Middle East for the long-term. They have to be.
Asia continues to be a tough place to operate – but there are signs that demand is returning. At Corporate Jet Investor Singaporein June lack of infrastructure was still the biggest issue (and one getting worse as airlines grow); many regulators do still not understand business aviation, demand is rising; and support for the fleet is getting better.
Dassault launched the first new aircraft of the year – with the Falcon 6Xannounced in March. Bombardier unveiled the Global 6500 and Global 7500 the day before EBACE and Embraer did the same with the Praetor 500 and Praetor 600 at NBAA. Boeing launched the BBJ 777-9 and BBJ 777-8 at the MEBAA in Dubai. A green BBJ 777-9 has a list price $453.6 million.
Bombardier also started deliveries of its flagship Global 7500 in December. It will be interesting to see how competitors react to this genuinely exciting aircraft. At CJI Miami, Gulfsteam CEO Mark Burns said: “Gulfstream has no intention to relinquish control of the market we created with G650.”
Some of the most significant news happened just before the key business jet shows. Serge Dassault, a true business aviation pioneer, died the day before EBACE started. Jet Aviation acquired Hawker Pacific the week before the ABACE convention (which is held in a Hawker facility) and Ron Draper replaced Scott Ernest as CEO of Textron Aviation three days before NBAA.
There was a lot written about 2018 being a seller’s market, but it was still a tough one for manufacturers. Nevertheless things are slowly improving. Many are optimistic about 2019, but more of that will be in our preview next week (our 2018 one was surprisingly accurate for once).
On behalf of Louisa, myself and the whole Corporate Jet Investor team we wish you a happy, prosperous and healthy 2019. We look forward to writing about it.
Our take on the main stories of 2018:
America is open for business jets – the Trump Bump starts
Maintain it and they will come – why investors like maintenance
Delivery rise masks fall in billings – 2017 looks much worse in dollars than units
Niche is nice – the benefits of biz liners
Saudi Shake-Up – why Saudi Arabian business aviation is in turmoil
Jersey has another go at popping – the other Channel Islands aircraft registry
Flying Japanese – a new operator in Japan is significant
eVTOLs, moats and buggy whips – why OEMs can win the personal mobility race
JetSuite order positive for electric aviation – electric aircraft are coming
Serge Dassault dies in Paris, aged 93 – the industry loses a true leader
How time flies for CEOs – a Harvard Business School Report explains why CEOs needs business aviation
A busy aviation week in Singapore – CJI Singapore
On Planet 9 – the launch of a new operator
BizAv History X – the end of the Citation X
Sellers rejoice – why it is now a seller’s market
The Plane’s Bond – why securitisation is changing business jet flying
Blink and it is gone – VLJ operator blames Brexit
Under the Oshkosh
Booking business aviation – the rise on online charter (we might have known what was coming with PrivateFly)
PrivateFly bets the house – Directional buys an online charter broker
The missing link between stocks and sales – why predicting new aircraft sales is getting harder
The Tech Arms Race – a visit to Wheels Up in New York
Blowing the socks off millennial buyers – musings from Monaco
Viva La Revolution.Aero – the new tech conference for aviation
Don’t buyback in anger – why share buybacks are bad news for jet sales
NetJets considers options (perhaps too cynical)
Miami Nice – The party started on Miami Beach