Ultimate Jet #73 - Phenom 300E Flight Test

Next step : adaptation and innovation
Looking into the crystal ball, how do we see business aviation
evolving in the next 12 months and beyond? The first caveat is that
we are still at an early stage of the consequences of the pandemic,
and indeed there are downside risks that the virus has secondary
waves to run. But assuming that the imminent public health crisis is
manageable, whilst a vaccine is not going to be available in the nearterm,
we believe we could see a multi-phase progression in recovery,
which we might characterise as a flattened W. We’ve seen the worst
of the first downward slope, with a low-point of 70% below normal.
Now the first upward recovery is in progress and should accelerate
in the next 2 months as suppression policies are relaxed in Europe
and the US. For many reasons, business aviation will fare better
than commercial activity during this phase: sectors are shorter,
and much of the traffic is domestic, where restrictions are lighter;
cabins are easier to clean, and passenger density is not an issue;
private terminals are much easier to enter and exit. Perhaps most
importantly, passenger motivation for flying private, whether lifestlye
or business, is probably more resilient than it is for flying commercial;
in short, the same objective cannot be achieved by Zoom.
Then inevitably will come the second down-draught, most likely not
a return of the virus but rather a secondary and more consequential
economic impact. The massive government support enacted when
the virus first hit cannot be extended indefinitely. Small business
loans and subsidised furloughs will translate into bankruptcies and
unemployment. The repercussions, even if we discount the more
damaging impacts on political and civic stability, will radiate out
across economic supply chains and significantly dislocate all travel
demand. Business aviation flight activity will likely see this slowdown
by the autumn of 2020, both in terms of the broad decline in economic
production, also the direct effect on its many small suppliers which
will run out of cash flow.
There will then be a renewed recovery, as disruption inevitably
generates adaptation and innovation. Business aviation will have
the opportunity to step up to fill gaps left in scheduled connectivity,
especially in galvanising regional networks. The historically low
penetration of business aviation in the wealthy population may start
to change as the convencience and privacy of flying private are
seen as benefits well worth paying for. A shake-up of the operator
market will see scaled up fleets and innovative business models
focused on providing effective utility services, unencumbered by the
need to provide luxurious standards of service. We are likely to see a
successful return and scaling-up of seat sharing and shuttle charters,
with on-demand travel fostered through membership programs cohosting
trusted travel communities. As traditional scheduled airlines
retreat for the foreseable future, this crisis may herald a much larger
personal aviation market which emerges from the resilience of
business aviation.
Ultimate Jet I 43