Bombardier and JETNET iQ rethink future
Bombardier released its latest 10 year forecast today at EBACE. It is forecasting that OEMs will sell 8,300 business jets worth $250 billion in the next 10 years. This is down by 700 aircraft on last year’s forecast because Bombardier expects the next few years to see less aircraft deliveries. The OEM says some 607 business jets were delivered in the markets it serves in 2015 (it does not include very light jets or airliners). It expects manufacturers to deliver between 540 and 560 aircraft in 2015.
It forecasts that North America will take 3,930 aircraft between 2016 and 2025, with Europe taking 1,530 jets. Bombardier also expects the average age of the fleet to fall as more aircraft are retired due to outdated avionics, noise regulations and new emission rules. (The OEM is very involved in representing business aviation at ICAO so has unique insight here.)
JETNET iQ also announced an update to its forecast – which also involved cutting deliveries. Rollie Vincent, director of JETNET iQ believes that 7,921 business jets will be delivered in the next 10 years.
His figures include ultra-light jets and airliners so is actually around 20% lower than Bombardier’s number.
There are a few ways you can take both forecasts.
Cynics can say that we should not trust any forecast. But this is unfair as both Bombardier and JETNET iQ deserve real credit for the brainpower and work they put into their forecasts. They may never be 100% right (and they are reliant on other financial forecasters) but they are helpful guides for anyone involved in long term planning.
Pessimists (or those who were out too late last night) can view it as another sign that the market is not recovering.
People who did yoga before the OEM’s 7.30 briefing (or people who have already started cocktails) can be more optimistic. The 8,300 aircraft Bombardier is forecasting is still significantly more than the 6,127 business jets of these types that have been delivered in the last 10 years.
NOTE: The above originally appeared as the editorial in our Corporate Jet Investor One Minute Week newsletter. To find out more, and sign up for free, please click here.
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