I’m John Persinos, editor-in-chief of Aircraft Value News. I’m also a contributing editor at Avionics International Report. Welcome to my latest video presentation, posted Friday, October 18. The accompanying article is a condensed transcript. For greater details and charts, watch my video.
The business jet market has shown a notable resurgence this year, particularly for the larger “heavy” business jet models. While the degree of improvement has varied among different models, the overall trajectory remains positive.
An expanding global economy and booming stock markets are generating a “wealth effect” that’s feeding demand for VIP/executive transport. The momentum is likely to last into 2025 and beyond.
According to Allied Market Research, the global business jet market size was valued at USD 26.8 billion in 2022 and is projected to reach USD 41.4 billion by 2032, growing at a compound annual growth rate (CAGR) of 4.5% from 2023 to 2032.
A significant factor driving this trend is the limited availability of both new and used aircraft. Manufacturers have faced supply chain challenges, hindering their ability to meet rising demand. Consequently, many owners are holding onto their existing jets longer than anticipated.
Innovative approaches to using business jets—such as accommodating families and larger groups—have further boosted demand. As inflation has led to increased prices for new jets, pre-owned models have become increasingly appealing. However, this trend is beginning to shift as inflationary pressures ease globally. The post-COVID era has witnessed a significant uptick in leisure travel, with families and affluent individuals eager to resume vacations.
According to Virtue Market Research, the global leisure travel market was valued at USD 1.46 trillion in 2023 and is projected to reach a market size of USD 5.81 trillion by the end of 2030. Over the forecast period of 2024–2030, the market is projected to grow at a CAGR of 21.8%.
The rising costs of commercial airfare have also spurred interest in business jet travel, which provides a more flexible and luxurious alternative. Given the strong correlation between gross domestic product (GDP) growth and business jet usage, the outlook for business jets, especially larger models, is promising.
Avionics innovation plays a major role…
Heavy business jets are renowned not only for their luxury but also for their advanced avionics packages. These jets typically feature some of the most cutting-edge avionics systems in aviation, which significantly boost their base values and lease rates.
Modern avionics in heavy business jets include advanced flight management systems (FMS), synthetic vision systems (SVS), and enhanced vision systems (EVS).
These avionics features allow for safer and more efficient flight operations in various weather conditions, reducing pilot workload. Pilots can access better real-time data for navigation, terrain awareness, and obstacle detection, leading to more reliable and safer operations. Buyers and lessees value this capability, which translates to higher demand and increased values and lease pricing.
When it comes to heavy business jets that have retained their value best, certain models stand out due to their long range, reliability, brand reputation, and popularity in the secondary market. These jets often retain a high percentage of their original value over time, even after several years in service.
Here are some of the most popular heavy business jets, known for strong value retention:
Gulfstream G650ER. Renowned for its long range and luxurious interior, the G650ER allows non-stop travel across the globe, appealing to high-net-worth individuals and corporations alike.
Bombardier Global 7500. With a spacious cabin and advanced avionics, the Global 7500 is versatile and reliable, making it a popular choice for international business travel.
Dassault Falcon 8X. Known for its fuel efficiency and sophisticated cockpit technology, the Falcon 8X is popular with VIPs and its values have been on the rise.
Embraer Lineage 1000E. This ultra-large executive jet offers a customizable interior and impressive range and features lower maintenance costs than comparable models.
Boeing Business Jet (BBJ) series. These aircraft, based on Boeing’s commercial airliners, offer ample space and comfort for larger groups, making them popular among corporate executives and government officials.
Airbus A319 corporate jet (the A319 VIP version) or ACJ319 for short is one of the biggest private jets available. It directly competes with the BBJ series. The A319 is considered to be in the vanguard of the heavy business jet segment; its base values and lease rates have shown strength as a result.
That said, Embraer is providing stiff competition to Airbus and Boeing business jets. Embraer’s jets, particularly the Lineage 1000E, are known for offering excellent range and performance at a lower operating cost than the jets from Airbus and Boeing. This positions Embraer as an attractive option for corporations and high-net-worth individuals looking for cost-effective yet luxurious travel. Brazil-based Embraer is increasingly challenging the Airbus/Boeing duopoly.
As the global economy rebounds, businesses are likely to increase travel budgets, leading to a greater demand for business jets. Larger models, which offer more space and amenities, are particularly appealing for corporate travel.
With companies resuming face-to-face meetings and events, there will be a renewed focus on efficient travel solutions, making heavy jets an attractive option into the foreseeable future for transporting teams and clients. Their values and lease rates are likely to improve further as demand continues to rise.
For the latest, highly detailed data on the base values and lease rates of these aircraft and many more models, consult Aircraft Value News.
If you have any questions or feedback, please don’t hesitate to contact me at [email protected].
