Asian Sky Quarterly 2022 Q4

GLOBAL BUSINESS AVIATION MARKET UPDATE
GLOBAL ECONOMY
14.0%
Global GDP YoY Percent Change
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023
(Forecast) (Forecast) (Forecast) (Forecast)
i
Supply chain disruptions and high inflation drove central
banks around the world to raise interest rates in 2022, creating
uncertainty. The war in Ukraine and the ensuing energy instability in
Europe, in addition to zero-COVID policies in China through much of
the year, contributed to economic headwinds. As a result, economic
growth slowed, and stock prices and wealth declined. ii
Heading into 2023, economists expect economic headwinds to
persist. There is a consensus that most major economies will
experience a recession during the year due to higher interest
rates. iii However, there is also agreement that any recession that
does occur will be a moderate one. The International Monetary
Fund recently increased its 2023 growth forecasts citing slowing
inflation, an opening of China’s economy, the strong labor market
in the U.S., and the better-than-expected response to the energy
crisis in Europe. The report indicates there are still risks to
economic growth, which will be slower in 2023 than 2022, but the
overall global economy is weathering tough conditions better than
expected so far, which will promote higher growth than previously
forecast. iv
FLIGHT OPERATIONS
Global Business Jet Flights
North America
Rest of World
629,714 652,741
23.7% 21.6%
814,816
24.0%
926,138 929,319 896,868
27.9% 23.5% 23.6%
973,906 945,218
905,513
25.3% 27.9% 23.2%
76.3% 78.4%
76.0% 72.1% 76.5% 76.4% 74.7% 72.1% 76.8%
Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022
v
Flight operations were a bright spot for the business aviation
market in 2022. Flights were 12 percent higher than in 2021 and
19.1 percent higher than in 2019. Increases were driven by existing
customers returning to business aviation even as new customers
who had entered the market during COVID-19 continued to utilize
business aviation throughout the year. The strong value proposition
of business aviation (including flexibility, productivity, and comfort)
during a period of continued COVID-19 outbreaks and disruptions to
commercial travel drove customers to the market. vi
The number of flights during Q4 declined slightly, dropping 2.6
percent compared to Q4 2021 and 4.2 percent from Q3 2022.
The number of flights was 17.8 percent above 2019, however,
demonstrating that the demand for business aviation has
continued at a higher plateau than pre-COVID levels. Much of the
decline was driven by operations in Europe, as consumers and
businesses cut travel in the face of high energy prices. In addition,
many business aircraft fleet operators reached full capacity in
2022, capping how many additional flights they were able to
make. vii
Heading into 2023, areas of potential growth for flight operations
include increased private and business usage and increasing
demand in Asia Pacific and the Middle East. viii
FOURTH QUARTER 2022 — GLOBAL SKY QUARTERLY | 53