Honeywell Business Jet Forecast Tempers Good News with Bad

About two-thirds of jet deliveries to North America.

Honeywell Business Jet Forecast

Honeywell Business Jet Forecast

Honeywell's latest business aviation market forecast released on Sunday offers a mix of good and not-so-good news for aircraft manufacturers, painting a generally optimistic picture for builders of large-cabin jets, but taking an opposite view of the light jet market, which is predicted to remain essentially flat for the next several years.

Overall, business jet deliveries will be down slightly this year, mostly due to certification delays of some new aircraft models. Honeywell predicts an annual 4- to 5-percent growth rate over the next decade, 1 percent lower than last year's outlook called for.

The forecast predicts deliveries of 9,250 new business jets worth $250 billion between now and 2022. That's a slightly lower delivery number than reported in past forecasts, but it represents a higher total dollar value as the sales mix trends toward larger business jet models with longer range, Honeywell said. While sales of large cabin jets will represent 56 percent of all deliveries by units, Honeywell notes the figure leaps to a whopping 83 percent by dollar value.

The outlook predicts North American business jet operators will replace or add to their fleets at a reasonably brisk pace in the next five years, equivalent to about 28 percent of the airplanes they now own. That's down slightly from the past few market surveys Honeywell has released.

Sales of new business jets will also see a slight shift back to the United States, with around 61 percent of predicted worldwide sales expected to come from buyers in North America, versus about 50 percent in recent years. Honeywell Aerospace president Rob Wilson called the trend "welcomed news" that should take up some of the slack in emerging markets that have cooled recently.

Still, sales to buyers in Russia, Brazil and the Asia-Pacific region are expected to represent more than a quarter of all deliveries in the coming decade as buyers in Russia and Brazil accelerate purchases of large jets and China begins to account for what Honeywell described as "solid contributions" to the global delivery total. Projections for sales in Europe were down by about 6 percent due to continuing economic uncertainty there.

The bizjet delivery breakdown by region in Honeywell's 2013 Outlook is as follows: North America increasing to 61 percent; Latin America holding steady at 18 percent; Europe declining to 12 percent; the Middle East and Africa declining slightly to 4 percent; and the Asia-Pacific region declining slightly to 5 percent.

Fractional providers, meanwhile, are making a solid comeback, Honeywell noted, and will contribute to the delivery totals beginning next year when the bulk orders placed recently by NetJets and Directional Aviation start translating to airplanes rolling out of factories.

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