Change is the Only Constant
By Colby McDowell | VanAllen
Having just returned from this year’s Corporate Jet Investor Conference in Miami, FL I am struck by the volume and pace of change in the Business Aviation sector today. During the conference, discussions were shared surrounding significant changes amongst OEMs, buyer motivations, market offerings, and the influence of technological advancements.
After several years of relatively little new development from the OEM side, new product offerings are coming to market at an impressive clip. The Gulfstream 500 program recently began delivering its first units with new 600 certification- deliveries are expected in early 2019. Bombardier received type certification for their new flagship, the Global 7500, in September. Embraer announced two new iterations of their former Legacy product lines as the rebranded Praetor 500 and 600, incorporating some design tweaks to enhance range and capabilities. Textron is competing with Embraer’s new designs with their own super mid-sized entrant, the Longitude, which should receive conditional FAA type certification in Q4 of 2018. They also recently announced plans to reinitiate the pursuit to certification and production of their large cabin offering, the Hemisphere.
Interestingly, there have also been rumors of a significant expansion in products and services at the OEM level. Both Gulfstream and Aerion are actively pursuing development of a supersonic business jet offering. There has also been talk of a robust vertical integration of services that could result in OEM competition in the aircraft maintenance and/or management space.
Another point of significant discussion at the conference was the evolution of the private Aviation marketplace. The evolution of buying motives within the marketplace continues to validate the concept of membership/access to business aircraft versus ownership. This sentiment is particularly strong among Generation Y and Generation Z segments. Service providers such as XOJET, Wheels Up, and JetSuite are seeing significant benefit from that market shift. Additionally, a potential shift in how aircraft could be used was being explored – specifically eVTOL (an electrically powered vertical takeoff and landing aircraft intended for short and mid-range missions). Through its acquisition of Aurora Flight Sciences and potential partnership with Embraer, Boeing appears to be on the forefront of this development. Uber Elevate, an urban aerial ridesharing solution, is currently in development as well.
Finally, some of the more noteworthy topics at the conference surrounded the viability and future of autonomous flight. With the impact of the pilot shortage within the industry becoming increasingly impactful for operators, salaries increasing exponentially, limitations on (human) duty day/rest requirements, and pilot error, the notion of removing the human pilot variable is intriguing.
It’s often said that change is the only constant, and I can think of no other time in my career that those words ring truer.
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