EBACE2023: Analysts Remain Bullish on Business Aviation Despite Slowdowns, Political Concerns

24 May 2023

Despite mounting external pressures and slight decreases in aircraft sales and flights over last year, a panel of industry analysts at the 2023 European Business Aviation Convention & Exhibition (EBACE2023) expressed general optimism the industry will continue to flourish throughout the remainder of the year and beyond.

Business aviation traffic across Europe and North America remains higher than 2019 levels, noted WingX Managing Director Richard Koe, although some metrics are trending lower than peak volumes in 2021 and 2022.

The industry also remains stronger overall than commercial airline traffic, which not only has rebounded at a much slower pace but offers notably fewer destinations today than prior to COVID-19, he added.

“Of 1474 connections flown [by European mainline airlines] in 2019, only 691 of those are still served in 2023 [and] we’ve also seen a 65% decline in regional network connections,” Koe said. “It’s quite interesting that 162 city-pairs are now flown by bizjets that weren’t flown at all [by business aircraft] in 2019, which shows bizjets are serving disappointed and underserved [airline] customers.”

Similarly, while there are also signs of a slowing market in sales of new and preowned aircraft transactions, “the good news is we’ve just taken our [transactions] forecast up by 10%,” said Rolland Vincent with JetNet iQ.

That market may also prove more resilient to economic downturns than in the past.

“In the 2008-2009 global financial crisis, transactions went down, and inventory went up, so values dropped,” Vincent said. “In this most recent economic slowdown we had very briefly in 2020, the opposite happened. Transactions skyrocketed. And we believe there’s a structural change that’s occurred.”

Another shift stemming from the pandemic that appears to be part of the “new normal” involves aircraft charters. “From 2018-2023, one-way charters increased from 47% [of all European charter inquires] to 57%,” said Harry Clarke, head of insight and analytics for Avinode Group. “That’s quite a significant change that reflects [customers’] changing habits.”

Overall, “I’m hopeful that [next year] we will reference 2023 as our new baseline,” he continued. “We won’t need to look all the way back to 2019.”

Despite overall positive news for business aviation, regional and global politics may alter the generally rosy outlook. “Amsterdam’s Schiphol Airport has seen amazing growth in business aviation over the last couple of years, [but now] there’s a ban on private jets on the radar,” Koe noted. “Such direct regulation in Europe is going to start constraining what can be flown.”

When asked about potential ramifications from the ongoing U.S. debt ceiling debate, Vincent offered a blunt assessment. “I’m much more worried about an escalation of the Ukrainian situation … than I am [the fight on] Capitol Hill,” he said. “I’m hopeful that minds will settle down, the adults will come in the room, and it will be fine.”