Honeywell Releases 2023 Business Aviation Market Forecast

The OEM projects that 8,500 new business jets, worth about $278 billion, will be delivered during the next ten years.

[Courtesy: Honeywell]

During its annual market report announcement on Sunday, Honeywell Aerospace has projected that 8,500 new business jets, worth about $278 billion, will be delivered during the next ten years—so says Javier Jimenez-Serrano, the firm’s strategy innovation manager. While the forecast remains unchanged from 2022, the total value of the new fleet has increased due to inflation and increasing list prices. Deliveries in 2024 will be 10 percent greater than in 2023 and sales revenue will increase 13 percent.

New business aircraft operators account for 500 of the sales from 2024 to 2033, increasing fleet
utilization by about 6 percent. Nineteen percent of existing business jet operators say that they will replace or add aircraft in their fleets in the next five years, accounting for more than 4,000 new aircraft deliveries.This is almost three times the replacement rate operators planned from 2010 to 2020. The purchasing expectation expectation also is 2 points higher than in 2022, reflecting operators’ optimism about the state of the industry and world economy. Almost two-thirds of respondents say they will fly as much in 2024 as they did in 2023. Twenty-nine percent say they will fly more hours next year. The overall size of the fleet will grow by 3 percent, according to Honeywell.

During the next five years, 64 percent of new aircraft will be delivered to North American customers, 14 percent to European operators and 11 percent to Asia-Pacific. Deliveries to the Middle East and Africa increase to 6 percent, but Latin America declines to 5 percent of global deliveries.

Jimenez-Serrano says that while fractional aircraft operators are not part of the survey, inputs from Part 91K operators, among other sources, help bolster the accuracy of the forecast. Sample size this year was a scant 100 operators, down from more than 1,500 in previous years. However, the Honeywell data closely parallels the projections of Rolland Vincent Associates of Plano, Texas, long considered one of the most credible market research firms in the business aviation industry. Jimenez-Serrano concedes that sampling error could approach +/-5 percent with only 100 respondents.

Working Through Backlogs, Supply Chain Recovery

The next three years will witness a strong surge in deliveries, as the supply chain fully recovers from the COVID slump and OEMs work off order backlogs. OEMs missed 350 deliveries from 2020 to 2022 because of COVID-induced supply chain snags. Deliveries plateau somewhat in 2028 and 2029 before slowly increasing to 930 deliveries in 2022. Jimenez-Serrano notes that total estimated deliveries during the next decade will be the highest in nearly a decade.

Midsize and super-midsize aircraft deliveries should increase about 15 percent in 2024. Long term, large cabin and ultra-long range aircraft deliveries, while only representing about 10 percent of the total, account for 69 percent of the sales revenues during the next five years. Jimenez-Serrano notes that Gulfstream’s GVII series, G400, G500 and G600, plus the Dassault Falcon 6X in the large cabin class, along with the Bombardier Global 7500/8000, Dassault Falcon 10X, and Gulfstream G700/G800, are well positioned to capitalize on this surge.

Honeywell’s Take on Sustainability

Sustainability increasingly is on the minds of business aircraft operators, with two-thirds of respondents saying they plan to embrace or increase efforts to reduce emissions. Current steps include flying fewer missions and using the airlines in lieu of their own business jets. Only 12 percent presently use biojet. Longer term, 39 percent say they plan to use sustainable aviation fuel (SAF) and another 28 percent will buy carbon offset credits.

But, jet fuel suppliers have been slow to increase production of SAF to meet a sharp increase in demand from both business aircraft operators and the airlines. The civil jet industry consumes nearly 100-billion gallons per year and SAF production amounts to only 100-million gallons. David Shilliday, vice president and general manager of Honeywell Power Systems, believes that the industry can boost output to 10-billion gallons per year by 2030, using existing refineries and feed stocks. If the industry is going to make the transition to 100 percent SAF by 2050, Shilliday believes that major U.S. federal government investment will be needed to help jet fuel suppliers achieve that goal. Without government aid, it’s unlikely that large scale increases in feedstock supply, SAF production and cost-per-gallon affordability can be achieved.

Fred George has flown in the left seat of nearly every business jet produced in the last 30 years, encompassing more than 195 aircraft models total over his career. He reports on the business aviation industry for FLYING, returning to the senior editor position after first contributing to the magazine in the 1980s and 90s.

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