2015 was an eventful year here at PrivateFly and for the business aviation industry. Market conditions were challenging overall, particularly in Europe (with unrest in Russia, Turkey and Eastern Europe continuing to dent demand) which is still showing a slight decline overall (0.8%) year on year.
But here at PrivateFly we managed to achieve significant year-on-year growth – both in Europe and in the US, where our customer base grew rapidly (it now accounts for 25% of our flights).
Private jet customers are increasingly looking to move online and to move to charter, now that new business models are making this so much easier than ever before. And at PrivateFly, we continued to lead this innovation in 2015, and look forward to doing so again this year.
These are some of the industry trends and developments I am looking out for in 2016.
1. Recovery will continue in the US, with Europe split
The USA is of course the biggest and most established global market and, after a modest 1.3% growth in 2015, I predict we’ll see a continued upswing in 2016. More business moving back, means more private jet demand. And we’ll see more US private jet customers flying internationally, including to Cuba.
Recovery in 2016 will lead to some customers choosing larger aircraft, such as the Legacy 500
Much of Europe saw encouraging recovery signs in 2015 (with 2.8% growth in the Western segment). So I expect to see continued resilience in 2016 in the major markets of France and the UK, and smaller growth markets such as Spain and Scandinavia. Germany is also starting to see some recovery at last, following a difficult couple of years.
I expect to see this increased confidence also leading to some customers upgrading to a larger category aircraft, so we’ll see the average spend per hour increasing.
But with the major market of Russia still likely to be in decline, overall we’ll still likely see just a modest growth picture for Europe overall.
2. The industry will move further towards 24-hour access
While we operate around-the-clock at PrivateFly, aircraft are not able to land or take off at all airports throughout the night. Some are open 24 hours for private jets, but others are not, largely due to noise concerns over residential areas.
But with industry recovery set to continue in 2016, there will more pressure on runway slots. And with private aviation so much about ease and flexibility, more and more customers are looking to fly at night or very early in the morning.
So I think we’ll see a number of airports reviewing their opening hours this year. Careful planning on routings and giving priority to quieter, new aircraft means it is possible to negotiate – as we have seen at London Biggin Hill.
More customers want to fly at night
It would be great if Geneva was one of them. The second busiest airport for private jets in Europe, Geneva has the most pressure on its availability. Always popular, it can easily reach sell-out status at peak times, such as during the ski season or around major events.
And unlike no.1 airport Paris Le Bourget, it is also an airline airport, so private jets have to compete for runway space with the airport’s airline customers. There is no other airport in Europe where airline and business aviation flights compete so fiercely for space.
Currently the standard operating hours are 0500 to 2100 (commercial) and 0500 to 2300 (non-commercial). If these could be extended, this would help to alleviate some of that pressure. See more: Are Geneva’s slot limitations leading to a private jet decline?
3. Sports events will put bizav under the spotlight – and under pressure
Major sports events always see a demand increase for private aviation. And we have a big year coming up in 2016, with the Super Bowl 50, the Olympic Games in Brazil and the UEFA European Championships in football.
Events like these are always a great opportunity for business aviation to showcase our flexibility. But can equally put the infrastructure under a lot of pressure, with huge numbers of aircraft looking to move in and out of a specific area over a short period of time.
While our industry excels at being reactive and providing short notice flights, our authorities are not always effective at forward-planning and organisation. Business aviation is often left out of the plans for major events and can be left working things out at a late stage.
For the Euros, it’s still unclear 6 months out, what special conditions will be made at airports close to the venues. Whereas other industries affected by the Championships will certainly have already been communicating their plans for some time now.
But let’s hope business aviation shine under the spotlight. Each time major events like this are held, airports and infrastructure learn a great deal, which can then be adopted into future best practice.
4. More new business models will open up the market
In the past 2 or 3 years we’ve seen an influx of new business models in the private jet sector. Some are succeeding and others have disappeared, and this trend is set to continue in 2016.
There is a huge amount of change going on in our industry. New technology has made it so much easier for the customer to compare prices and book, and a new era of transparency and accessibility is now firmly here.
Entry level demand will continue to drive innovation and growth
This year we’ll see growth in models aimed at the entry-level private jet customer in particular, such as air taxi-type operators offering shared private flights on fixed routes. This is opening up the customer base for the whole charter industry, so it’s great to see this innovation taking place.
5. More regulation as the market matures
Another mark of the private jet industry maturing has been a more defined regulatory framework for service providers, and I think we’ll see even more of this in 2016.
Following the first wave this summer, we’ll see a rush of other European FBOs granted an IS-BAH, the new quality standard for private jet FBOs, which is gaining a lot of participation in the US.
And more private jet brokers will seek ARGUS certification, a benchmark of industry best practice. This is something we hold at PrivateFly, giving both customers and aircraft operators confidence in our high operational standards.
I predict we’ll see a marked increase in the participation in these programs in 2016, and the launch of others.
Wherever and whenever you’re flying in 2016, our Flight Team are ready and waiting to help. Contact us or call +44 1747 642 777 (24 hours).
