In 1971, American singer/songwriter Carly Simon released an album and hit song Anticipation, strumming “these are the good old days.” While the wait for the second-quarter GAMA shipment report wasn’t quite like ketchup coming out of a Heinz bottle, it sure must have felt that way to some industry observers.

The headline—that business jet unit shipments were up 12.5 percent year-over-year in the first half—was welcome news indeed. After a more than 10-year period in the doldrums, there are encouraging signs of strength in the business jet market—one that we at JetNet iQ closely monitor, analyze, and forecast.

Few who live and work outside the industry can readily appreciate the many nuances of the business jet manufacturing business. It is global and highly capital intensive, with long investment horizons, and a collection of competitors ranging from the well-established to the more recently arrived.

The industry serves a relatively small community of customers, most of whom are at the absolute peak of the socio-economic pyramid. Sometimes described as the 1 percent, they are more typically members of the unofficial 0.01 percent club—highly successfully and typically highly engaged in the selection and purchase of their business aircraft.

Among their ranks are business owners, entrepreneurs, and aficionados who appreciate the finest things in life, as well as the many benefits of life in the fastest lane. It is not too difficult to imagine that they might be enticed to invest at least some of their hard-earned capital in business aviation. 

The post-2008 rebound in new business jet sales has been a long time coming. Borrowing from the “build it and they will come” playbook, at least three business jet OEMs are finally beginning to reap the harvest after many years and, collectively, billions of dollars of investments in engineering, design, test, tooling, equipment, and facilities.

Driving up the GAMA delivery shipments data are a number of new business jets that have recently entered service and are in production ramp-up. Among the most promising is the Pilatus PC-24, which single-handedly accounted for more than one-third of the industry’s higher year-over-year business jet shipments in the first six months.

Having received EASA and FAA certification in December 2017, the PC-24 has been carving out its own market space at the top of the light jet segment. It has a particular appeal to PC-12 turboprop operators who are anxious to step up to a twinjet while retaining many of the features that they found appealing about their big single, all while picking up more than 150 knots of airspeed. Production ramp-up of the PC-24 is now under way, with management targeting about 50 deliveries per year of the circa-$10 million jets.

At the entry point of the business jet market, Cirrus Aircraft’s $2.7 million single-engine, six-passenger Vision Jet was certified by the FAA and began customer deliveries in late 2016. Production ramp-up continues in 2019, with first-half deliveries up 24 percent year-over-year, with output on a path to about 75 aircraft this year.

Together, the PC-24 and Cirrus Vision Jet account for more than half of the higher business jet deliveries detailed in the most recent GAMA shipment report.

Meanwhile, the Gulfstream G500—an all-new and highly anticipated $46 million large-cabin, long-range twinjet with fly-by-wire sidestick controls—is another big contributor to the industry’s year-over-year increase in shipments. As with the PC-24, the G500 also accounted for more than one-third of the overall improvement in first-half jet shipments.

The second half of the year, already well under way, is always associated with higher aircraft deliveries. Joining the production ramp-up in this latter part of the year is the top-of-market $73 million Bombardier Global 7500, as well as the $58 million Gulfstream G600, and the $27 million Cessna Citation Longitude, all of which should account for double-digit year-over-year increases in unit deliveries.

Sprinkled throughout the GAMA report were smaller, but not inconsequential, improvements in output of a few additional aircraft that have proven popular in the market, including the Embraer Phenom 300E and Cessna Citation Latitude and CJ4. Consistent with purchase-intention results from the last several JetNet iQ Surveys, I have been calling for some long-awaited strengthening of the light to midsize business jet market, with higher year-over-year orders and deliveries.

I expect more good news to be reported by GAMA at both its third-quarter report and year-end 2019 press conference, the latter sometime in February.  A recovery, and more recently a rebound, in book-to-bill and backlog performance across the business jet OEMs has been a welcome change in the latter half of 2018 and so far into 2019, after many years with few ups and many downs.

Maintaining this trajectory in the face of inevitable headwinds—some of which were expected and others the result of international trade and geopolitical forces—should be a priority of every industry stakeholder, regardless of rank, position, or political stripe. Business aviation, like business itself, works best when stakeholders have confidence in the present and the future.

In light of recent macroeconomic and political developments—ranging from an inverted U.S. Treasury yield curve, jittery and gyrating equity markets, a possible German recession, negative European interest rates, a no-rules Brexit, another highly contentious U.S. federal election, and the powder keg of riots in Hong Kong—the near-term future has become not only cloudy but convective and highly unstable.

After such a long, slow period of recovery in the business jet industry, it sure would be nice to continue living the “good old days” again. As a forecaster and industry advocate, I find that it is, unfortunately, getting harder to see that in the crystal ball.