Business aviation manufacturers have not escaped the supply chain and workforce woes plaguing commercial aerospace, but those problems come with a silver lining: the industry’s uptick will likely be more measured and longer lasting.
That’s the view of Bank of America analyst Ronald J. Epstein, who participated in an NBAA-BACE Newsmakers Luncheon in Las Vegas in the run-up to the opening of the 2023 show.
Epstein and other panelists noted that a limited supply of aircraft engines and other components is constraining business aircraft manufacturers from ramping up production too fast and overheating the industry. “It probably extends your cycle because nobody can deliver too fast,” he said, adding that a more measured upswing also will allow manufacturers to hold the line on prices.
And it likely will take some time for the supply chain to normalize, Epstein added, noting that major suppliers in commercial aviation have prioritized their two biggest customers: Airbus and Boeing. “Until that supply chain gets sorted out, this supply chain won’t get sorted out,” he said.
Also overhanging this year’s event are rising pressure for the aviation industry to become more sustainable. That was underscored when environmental protestors crashed the static display at NBAA’s EBACE show in Switzerland in May and glued themselves to business aircraft on display. Security at the Las Vegas show has been tightened, with attendees having to show both their pass and a photo ID when they enter the convention center.
Epstein and Jefferies analyst Sheila Kahyaoglu, another panelist, agreed that business aviation faces more of an optics and public relations problem, given that it emits a tiny fraction of global carbon emissions. If all business jet operators transitioned to sustainable aviation fuel (SAF) or electric propulsion “it wouldn’t make a difference” to the environment, Epstein said.
A third panelist, Rolland Vincent Associates President Rolland Vincent, noted that the industry’s commitment to embracing sustainability, while improving, still has a ways to go. “We don’t have a complete commitment to it,” he said. “There are still operators that don’t think it’s important.”
NBAA President and CEO Ed Bolen, who opened the panel, hinted the organization would be sharing more details on how the industry plans to reduce its carbon footprint after the show opens on Oct. 17. “We’re on a mission to net zero,” he proclaimed.
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