According to the 25th annual Global Business Aviation Outlook released by Honeywell, the business aviation industry continues to face a slow near-term pace of orders due to a slow-growth economic environment across many global markets along with many political uncertainties.

The Global Business Aviation Outlook forecasts up to 8,600 new business jet deliveries worth $255 billion from 2016 to 2026, which represents a 6% to 7% reduction from the values noted in the 2015 forecast.

“We continue to see relatively slow economic growth projections in many mature business jet markets. While developed economies are generally faring better, commodities demand, foreign exchange and political uncertainties remain as concerns,” said Brian Sill, president, Commercial Aviation, Honeywell Aerospace. “These factors continue to affect near- term purchases, but the survey responses this year indicate there is improved interest in new aircraft acquisition in the medium term, particularly in the 2018 to 2019 period. In the meantime, operators we surveyed this year indicated plans to increase usage of current aircraft modestly in the next 12 months, providing some welcome momentum to aftermarket activity, which has been flat recently.”

Key global findings in the 2016 Honeywell outlook include:

• Deliveries of approximately 650 to 675 new jets in 2016, a low- to mid-single-digit percentage decline year over year. The pullback in deliveries expected in 2016 comes on the heels of a small increase in 2015 and is largely due to slower order rates for mature models and a stabilization in fractional-usage type of aircraft deliveries.
• 2017 deliveries are projected to be slightly lower, reflecting transitions to new models slated for late 2017 and 2018 service entry.
• Operators plan to make new jet purchases equivalent to about 27% of their fleets over the next five years as replacements or additions to their current fleet, an encouraging increase but one that is less than firm in timing.
• Of the total purchase plans for new business jets, 21% are intended to occur by the end of 2017, while 18 percent are scheduled for 2018 and 2019, respectively.
• Operators continue to focus on larger-cabin aircraft classes, ranging from super mid-size through ultralong-range and business liner, which are expected to account for more than 85% of all expenditures on new business jets in the next five years.
• The longer-range forecast through 2026 projects a 3% to 4% average annual growth rate despite the lower short-term outlook as new models and improved economic performance contribute to industry growth.
• Gains in five-year operator purchase plans are offset in the long-term forecast based on changes in new program timing, slower economic growth projections, and political and currency uncertainties, resulting in a moderately lower overall outlook.