In Q1 2024, the business jet market continued to normalize following the record high utilization and demand associated with the post COVID-19 pandemic period. Flight operations and transaction volume declined year-over-year and inventory levels rose. The economy also continued to face a variety of challenges impacting growth. Despite these challenges, business aviation remained resilient. Flight operations were above pre-COVID-19 levels, OEMs reported strong backlog growth, and inventory remained low, especially for younger, more desirable aircraft. As things stand, the industry is well positioned to weather any future economic downturn.
- Many economists have raised their forecasts for 2024, but challenges to future growth persist.
- Flight operations declined 2 percent year-over-year in Q1 2024 but were 16 percent above Q1 2019 levels, reflecting an enduring expansion in the user base for business aviation.
- OEM book-to-bill ratios were around 1.3-to-1 in Q1 with backlogs growing, demonstrating continued demand for new aircraft.
- Transactions declined in Q1 2024 due to slower-than-expected new deliveries (attributable to ongoing supply chain and labor issues and delays in aircraft certification) and price-driven inertia between buyers and sellers in the pre-owned market.
- Aircraft inventory increased in Q1. But it is important to note that a split between older aircraft and younger aircraft has emerged. Older aircraft inventory continued to increase, while inventory of younger aircraft has been stable for three quarters.
- Most aircraft models continued to experience depreciation in line with historical norms during Q1 2024. However, younger aircraft have been more stable than older aircraft.
