The business aviation finance market is ready to grow, in accordance with research released this week at NBAA-BACE 2023 by Airbus Corporate Jets. The study surveyed 50 private jet brokers and 50 business aviation financiers.
In line with the study, 82 percent of U.S.-based business aviation financiers and personal jet brokers expect access to this financing to extend over the following three years and 98 percent consider that jet financing rates remain attractive. But 25 percent consider future deals would require substantially additional cash, while 54 percent expect only a slight rise within the money requirements.
Meanwhile, 74 percent see a preference for fixed, versus floating, rates of interest over the following five years for those using leases and credit. Some 69 percent of respondents expect leasing will increase between now and 2028.
A jump in demand for larger business jets over the following five years was seen by 85 percent of respondents, 51 percent believed this might aid in maintaining residual value, and 77 percent believed the increased demand would make financing of larger jets comparatively easier than smaller aircraft. Finally, 68 percent consider that specialist lenders will increase their market share over mainstream banks.
The increased financing is seen as key to the $150 billion business aviation contributes annually to the U.S. economy, a number forecasted to grow to $190 billion in five years by 31 percent of those surveyed and to $180 billion by 69 percent. Fully 72 percent expect business aviation activity to extend in support of the economies of communities without industrial airline service, and 76 percent see a rise within the role of business aviation in supporting emergency and humanitarian relief.
A separate survey of senior executives at large corporations that own private jets indicated that 77 percent of those firms already use their aircraft for humanitarian and charitable purposes and that 87 percent think such utilization will increase over the following three years.
On the environmental front, 93 percent of senior executives surveyed who charter business aircraft said they might give attention to chartering newer, more efficient aircraft, 95 percent who own or lease aircraft said they’re investing more in technology for route optimization to cut back fuel burn and emissions, and 61 percent consider their company would increase their aviation budget by as much as 25 percent to purchase sustainable aviation fuel (SAF) and/or buy more fuel-efficient aircraft.
Overall, environmental awareness amongst this surveyed group also appears to be increasing, with 95 percent saying their firms have understanding of the carbon footprint of their flights. Notably, nine out of 10 said their carbon footprint understanding has improved over the past five years, with 49 percent saying that understanding has increased dramatically.
The 2 essential reasons cited for this shift include the appointment of specialists to observe the carbon footprint of those flights and increased investment in these teams, while a 3rd is more detailed carbon data collected on these flights.
In other news at the corporate, the Airbus ACJ TwoTwenty is making its NBAA-BACE debut at this 12 months’s show. Airbus stressed that the “Xtra Large Bizjet” aircraft derived from the single-aisle A220 airliner is already able to flying on a mix of fifty percent SAF.