- 32nd annual Global Business Aviation Outlook projects 8,500
new business jet deliveries valued at $278
billion over the next decade
- Fleet expansion plans have increased for a third consecutive
year
- Operators show a heightened interest in actively reducing
their carbon emissions
- New users in business aviation have increased demand by 500
new aircraft and 6% additional flights over the next
decade
LAS
VEGAS, Oct. 15, 2023 /PRNewswire/ -- Honeywell's
(NASDAQ: HON) 32nd annual Global Business Aviation Outlook
forecasts up to 8,500 new business jet deliveries worth
$278 billion from 2024 to 2033, in
line with the same 10-year forecast a year ago. This year, surveyed
business aviation operators reported higher five-year new jet
purchase plans, which is up two percentage points from a year ago.
However, fleet expansion rates nearly tripled in 2023's survey
compared to the decade average preceding 2020. The intentions
gathered from respondents are consistent with what the OEMs
reported to investors in Q2 — an increase in delivery pace during
the first half of 2023, which further aligns with the industry's
efforts to scale up production in response to record-high
backlogs.
"Our industry is on the upswing. Operators are showing
confidence with plans to expand their fleets at a faster rate than
any time in the previous decade. Notably, we are excited by the
recent announcements from fractional operators indicating their
intent to acquire several hundred new jets, including midsize and
super-midsize jets powered by Honeywell HTF engines," said
Heath Patrick, president, Americas
Aftermarket, Honeywell Aerospace. "There's also a positive shift
toward sustainability, as operators are keen to reduce carbon
emissions. Additionally, new users in business aviation have
increased demand by 500 aircraft and 6% more flights over the next
10 years. This, along with expected double-digit increases in
turbofan deliveries in 2023 and 2024, shows our industry's
commitment to meeting growing demand."
Key findings in the 2023 Honeywell Global Business Aviation
Outlook include:
- New business jet deliveries in 2024 are expected to be 10%
higher than in 2023. Expenditures are expected to be 13%
higher.
- Five-year purchase plans for new business jets are up two
percentage points compared with last year's survey; this surpasses
2019 levels and is equivalent to 19% of the current fleet.
- Fleet additions are up for the third year in a row, topping 3%
of the fleet.
- New jet deliveries and expenditures over the next decade are
projected to grow at a 2% average annual rate, in line with
expected worldwide long-term economic growth.
- Nearly two-thirds of those surveyed expect to fly the same in
2024 versus 2023; 29% expect to fly more, and just 7% expect to fly
less.
- Large, long-range and ultra-long-range aircraft classes are
expected to account for about 69% of all expenditures of new
business jets in the next five years.
- 4% of surveyed operators plan to dispose of an aircraft without
replacement, which is double of the rate gleaned in 2022; most
citing retirement or death of the aircraft owner.
Sustainability in business aviation
Honeywell is
committed to reaching carbon neutrality by 2035 in its operations
and facilities and to driving aviation sustainability with a wide
range of ready-now solutions that will support a more sustainable
future for the sector. This year's survey, for the third
consecutive year, features a dedicated section on operators'
current and future plans to reduce their carbon footprint during
operations.
- Almost 60% of this year's surveyed operators report currently
implementing at least one method to reduce their carbon footprint,
which is 10 percentage points above last year's survey.
- The most frequently mentioned current method to reduce carbon
footprint is "fewer private jet trips in favor of commercial
flying" (31%), followed by "slower cruising speeds" (18%).
- 67% of operators plan to either adopt or increase methods for
more environmentally friendly operations in the future, and 40%
cite SAF as the most common way to achieve this goal.
- The survey asked the remaining 33% what would compel them to
adopt any methods to address sustainability in the future, and 65%
of these operators cited economic incentives such as tax benefits
or operating cost savings followed by 44% citing government
regulations.
Regional breakdown and preowned aircraft
North
America: North American fleets account
for 64% of the five-year new jet deliveries. This year's share is
on par with last year's and is likely driven by 90% of North
American respondents believing that the economy will at least
remain the same if not improve. This makes North America the most optimistic region in
2023.
Europe: European operators
will make up 14% of the five-year new jet deliveries. This is one
percentage point below last year's share, driven by economic
uncertainty and a strong focus on sustainability in this
continent.
Latin
America: Operators in the Latin American
region will make up 5% of global deliveries in the next five years,
two percentage points below 2022's share. Nearly 70% of Latin
American operators report that local economic conditions will
remain the same or decline in the near future, making this region
the most pessimistic.
Asia
Pacific: This region will make up 11% of
new jet demand over the next five years, one percentage point up
from the previous year. Operators here have seen the second-highest
business aviation utilization growth in 2023 behind only the
Middle East.
Middle East/Africa: Fleets here will
account for 6% of the five-year new jet deliveries. This is two
percentage points above last year's share. This region accounted
for the most growth in Bizav flights in 2023.
Preowned Aircraft: Five-year purchase
plans for used jets total 27% of the current fleet, just one
percentage point below last year's results. After record-high
demand for used jets the past two years, 2023 will see a slight
increase in the inventory of jets available for sale.
Update on new users of business and private
aviation
The business aviation industry experienced a surge
in first-time private aviation users and buyers after the onset of
the COVID-19 pandemic. At certain points in 2022, this trend drove
flight activity to levels not seen since 2007. However, in 2023,
global flight activity declined and is expected to decrease this
year by approximately 4% compared with 2022. This decline can be
attributed to factors such as inflation and the resumption of
commercial air service on key routes.
Furthermore, the pace of new orders for jets has slowed down
while OEMs focus on meeting current demand by significantly
increasing production rates over the next several years. It is
anticipated that flight activity will stabilize in 2024 and return
to growth in 2025, driven by an accelerated pace in IPOs, corporate
profits and easing inflation rates. Consequently, we will be able
to assess in 2024 how many of these new users and buyers have
remained in the business aviation sector and determine their
long-term impact. However, a large impact is already being
felt:
- 500 additional bizjets: The pre-COVID 2020 long-term new
jet delivery forecast contained just over 8,000 aircraft for the
2024-2033 period, while the latest 32nd Annual Honeywell Outlook
forecasts 8,500.
- 6% more flight activity: 2023 flight activity is still
expected to finish at least 10% above 2019 levels; if we assume a
historically consistent average annual growth rate of 1 to 2%, it
can be anticipated that 2023 will conclude with flight activity 2
to 6% above where the industry would have been if it had not been
impacted by COVID.
Making an Impact on Business Decisions
The Global
Business Aviation Outlook reflects current operator concerns and
identifies longer-cycle trends that Honeywell uses in its own
product decision process. The survey has helped identify
opportunities for investments in sustainability solutions, has
expanded propulsion offerings, innovative safety products, services
and upgrades, and has enhanced aircraft connectivity offerings. The
survey informs Honeywell's business pursuit strategy and helps
consistently position the company on high-value platforms in growth
sectors.
Methodology
Honeywell's forecast methodology is based
on multiple sources, including macroeconomic analyses, original
equipment manufacturers' production and development plans shared
with the company, and expert deliberations from aerospace industry
leaders. Honeywell also uses information gathered from interviews
conducted during the forecasting cycle with 100 nonfractional
business jet operators representing a fleet of 206 business
aircraft worldwide. The survey sample is representative of the
entire industry in terms of geography, operation and fleet
composition. This comprehensive approach provides Honeywell with
unique insights into operator sentiments, preferences and concerns
and provides considerable insight into product development needs
and opportunities.
About Honeywell
Honeywell Aerospace products and services are found on virtually
every commercial, defense and space aircraft. The Aerospace
business unit builds aircraft engines, cockpit and cabin
electronics, wireless connectivity systems, mechanical components
and more. Its hardware and software solutions create more
fuel-efficient aircraft, more direct and on-time flights and safer
skies and airports. For more information, visit www.honeywell.com
or follow us at @Honeywell_Aero.
Honeywell (www.honeywell.com) is a Fortune 100 technology
company that delivers industry specific solutions that include
aerospace products and services; control technologies for buildings
and industry; and performance materials globally. Our technologies
help aircraft, buildings, manufacturing plants, supply chains and
workers become more connected to make our world smarter, safer and
more sustainable. For more news and information on Honeywell,
please visit www.honeywell.com/newsroom.
This release contains certain statements that may be deemed
"forward-looking statements" within the meaning of Section 21E of
the Securities Exchange Act of 1934. All statements, other than
statements of historical fact, that address activities, events or
developments that we or our management intends, expects, projects,
believes or anticipates will or may occur in the future are
forward-looking statements. Such statements are based upon certain
assumptions and assessments made by our management in light of
their experience and their perception of historical trends, current
economic and industry conditions, expected future developments and
other factors they believe to be appropriate. The forward-looking
statements included in this release are also subject to a number of
material risks and uncertainties, including but not limited to
economic, competitive, governmental and technological factors
affecting our operations, markets, products, services and prices.
Such forward-looking statements are not guarantees of future
performance, and actual results, developments and business
decisions may differ from those envisaged by such forward-looking
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Contacts:
Media
Adam Kress
(602) 760-6252
adam.kress@honeywell.com
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