Business Aviation Market Intelligence

Market Survey Results Summary – Asian Sky Quarterly 2020 Q3

Market Survey Results Summary – Asian Sky Quarterly 2020 Q3

*Aircraft Service Providers include: financial services, training, FBO, ground handlers, Service, MRO, parts, etc.
** Others include law firms, research facilities and government official

Results Summary in 2020 Q3

1. Good News: Pessimistic mood in APAC continued to stabilize in Q3; respondents from Greater China took the lead in terms of optimism levels. This was a major bounce back for the region’s optimism, reaching the highest levels since 2018 Q2 – 70%. Additionally, this quarter saw an uptick of respondents who believe market demand will bounce back in the first half of 2021.

2. In Q3 2020, more respondents (vs. Q1 & Q2) reported that their businesses are still being affected and now have less hope that they will meet their business performance targets for 2020.

3. Many respondents’ domestic operation recovery performed better than their overseas, but 50% of the respondents still believed that their operations for both domestic and international operations have not yet reached a point of recovery or cited “hard to tell”.

4. A historically high 72% of respondents reported decreasing aircraft fleet utilization.

5. A high level of respondents cited “not sure” when asked about purchasing an aircraft.

In 2020 Q3, over 420 respondents participated in ASG’s survey regarding the mood and intentions of the current business aviation market.

Regions with the most respondents include:

1. Greater China (20%) 2. Southeast and Northeast Asia (22%) 3. Central Asia & Middle East (41%, incl. India, Pakistan, UAE, etc.) 4. Oceania (6%)

The majority of the respondent’s aircraft type are business jets (67%).

69% of the respondents from this quarter’s survey are from aircraft service providers
(FBO, MRO, etc.) and aircraft operators, as well as from aircraft brokers (10%), aircraft
end-users (3%) and respondents from other related areas.

Covid-19 Pandemic in the Asia Pacific

The pessimistic mood caused by Covid-19 in the Asia Pacific has eased as an economic rebound was seen in the Greater China market. This has, consequently, stabilized market mood as more respondents in Q3 believed that market demand will bounce back in the first half of 2021.

The ongoing pandemic has continued its impact on the business aviation industry. Companies are adjusting their business performance expectations and experiencing difficulty trying to recover their businesses. And, as suspected, domestic operations in the Asia Pacific have recovered quicker than overseas operations.

In this quarter’s survey, ASG added a new question asking respondents how their domestic operations recovery compared with their overseas operations. The answers were consistent with our current understanding:

• Over 30% of the respondents have not yet begun to experience business recovery;

• Nearly no businesses are free from the impact of Covid-19;

• Domestic business recovers quicker than overseas business.

Aircraft Utilization

Q3 experienced even less utilization of the regional fleet compared with Q2. Like Q2, all regions suffered from decreased fleet utilization due to Covid-19; 55% of the respondents reported their fleet utilization has decreased over 20% compared with 2019 Q3. Once again, this marks the highest point of decreasing utilization levels since the survey began.

Purchase Intention

Aircraft purchase intention has been affected, as well. More respondents are now are not sure whether to purchase an aircraft. This comes as many brokers are hesitant to define the market situation as well. ASG’s survey saw a drop in respondents believing this is a ‘Buyer’s Market’ shifting to “I’m not sure”.

Economics Status

Covid-19: Impact on Asia Pacific

Purchase Intention

Fleet Utilization

* An Optimistic-Pessimistic Signal Line has been added to regional aircraft usage trend analyses for Greater China, Oceania and South and East Asia regions. An optimistic mood is derived from more people indicating ‘higher’ aircraft utilization compared with 12 months ago, while a pessimistic mood is derived from more people indicating ‘lower’ aircraft utilization compared with 12 months ago.