Asian Sky Quarterly - Q3 2020

PUBLISHER’S NOTE
The good news is that the toehold of a recovery we saw and hoped
for last quarter is here to stay. Respondents to our quarterly survey
are feeling better about their business prospects going forward and
optimism continued its steep rise back for the 2nd quarter in a row.
But as we all know “feelings” sometimes take a while to trickle down
and for that optimism to manifest itself as tangible happenings on
the ground.
So, the bad news is economies & their GDP, for now, continue to be
hammered by the pandemic – from contracting 23.9% y-o-y in India to
just -3.2% in South Korea. The only economies seemingly weathering
the storm are Taiwan just -0.58% and China +3.2%. Not too surprising
then, in our survey on the impact of Covid-19, even more respondents
said their businesses are being impacted somewhat or severely.
Respondents see a higher chance of the market bouncing back in the
1st half of 2021 but, as far as 2020 is concerned, the year’s a bust with
no chance for business performance targets being met.
Similarly, we’ve seen a recovery in aircraft utilization - from the depths
of despair in April, till today where we are still down but just a seemingly
modest 9%. Call it a “V” shaped recovery or a flattening of the curve,
we’ll take it as the industry needs aircraft in the air. The recovery has
mostly been driven by increased international travel too and leads by
a recovery in Chinese travellers and airports.
As always in our editions of Asian Sky Quarterly, also graciously
providing us their views and backing them up with intel and hard data,
are WINGX, Global Jet Capital and Amstat. So, please take a look. In
this issue we also go “small” putting the spotlight on two industryleading
aircraft: the Hondajet Elite and the pre-owned Phenom 300/E
market. You’ll also find commentary by Chris O’Callaghan of HFW on
Life Beyond the Pandemic; an interview with Comlux Aviation CEO –
Andrea Zanetto, on the company’s business jet management division;
and an extract from Air & Sea Analytics’s market report on the S-92
Fleet during Q3 2020. Lastly, we hear from AsBAA chief operating
officer Jeff Chiang in our foreword, discussing the organization’s latest
and upcoming events.
What this all means for business jet sales is probably best to describe
as “mixed”. There’s a slight optimistic uptick in purchase intentions
of pre-owned aircraft (3%) but more aircraft are on the market for
sale (4.1%), taking longer to sell, resulting in prices and ultimately
values continuing to drop. From March through June and July values
fell between 15% and 20% in the Heavy, Super-Mid and Medium Jet
categories, although there was a slight recovery in August.
We hope you find this issue informative and insightful.
Year-to-date therefore transactions are down versus 2019 due to the
economic effects of Covid-19. But the market activity has increased
sequentially each month in the last quarter. Whether this trend
will continue for the remainder of the year, remains to be seen but
hopefully so.
Sincerely,
Jeffrey C. Lowe
Managing Director, Asian Sky Group
SPECIAL THANKS TO OUR CONTRIBUTORS:
2 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020