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Vacation trips, easing of travel rules fuel hopes of business jet rebound
[MONTREAL] A pick-up in leisure trips and easing European travel restrictions are driving demand for business jet flights this summer, fuelling cautious hopes for a rebound in an industry hit hard by the coronavirus pandemic, executives and forecasters said.
Commercial and business aviation are both seeing improved domestic traffic this summer. But private flights, which carry smaller groups and promise wealthy passengers less risk of exposure to the coronavirus, have generally fared better than commercial airlines since the start of the pandemic.
US business aviation traffic is down around 20 per cent year to date through July 19 on an annual basis, compared to a decline in US commercial airline traffic of 48 per cent over the same period, according to FlightAware data.
Adam Twidell, chief executive at Private Fly, a global booking service for charter flights, said his company's booking levels are around 80 per cent of last year's mark in Europe, and over 100 per cent in the US, helped by inquiries from new passengers.
New customers, including those who normally fly first class on airlines, now make up around 60 per cent of the company's flight bookings compared with around a quarter normally.
"We know that a considerable number of them have not flown privately before," Mr Twidell said.
Private jet charter VistaJet said it recorded a 153 per cent increase for European departures between May and June and expects a similar increase for July.
Business aviation flights in Europe could be down just 10 per cent this summer compared with the same period a year earlier, helped by pent-up leisure travel demand and limited selection of commercial flights, said Richard Koe, managing director of data research and consulting company WINGX Advance. By comparison, European flights were down 15 per cent in July and 30 per cent in June on an annual basis, Mr Koe said.
But industry executives cautioned that the green shoots of demand for private aviation will only continue into the fall if there is a pick-up in company travel.
"Personal travel is the driving force on both continents at the moment as business travel continues to be down significantly," said Patrick Gallagher, a marketing executive for Berkshire Hathaway's NetJets, which is seeing improved European demand following the easing of travel restrictions last month.
"Relaxation in travel restrictions certainly played a part in that, but the seasonality of demand in Europe also led to the later, steeper recovery," he said.
Business jet makers are waiting to see if the revival in flights could eventually lead to new orders. For now, charters are using existing fleets to meet demand.
While jet makers are seeing little appetite for new plane sales, firm orders are not being cancelled, which points to some stability, two industry sources said.
Business jet makers, like General Dynamics's Gulfstream Aerospace, Textron Aviation and Bombardier, have cut jobs and some forecasters expect a 30 per cent decline in deliveries this year.