Thanks to new technology, flying in a private jet is no longer just for business titans and the super-wealthy. But in a paradox, that means aircraft manufacturers like Cessna and Bombardier Inc. are selling fewer planes.
The general aviation industry is undergoing a major shakeup as new business models attempt to match idle aircraft with passengers, many of whom now can’t afford their own plane. Membership companies, ride-sharing programs, on-demand charter providers and start-ups claiming to be the Uber of private aviation are all looking to introduce more people to the convenience of flying without the hassle of commercial airports.
“Unfortunately for airplane manufacturers, these new programs aren’t out buying a lot of new jets,” said Brian Foley, a business-aircraft consultant who spent 20 years as director of marketing for the North American jet unit of France’s Dassault Aviation SA. “They’re just trying to use existing assets out there and get more utilization out of those parked airplanes.”
Manufacturers have throttled back production of some models to adjust to weaker demand for private aircraft. New jet deliveries are expected to drop 6.4 percent this year to 645 and slip another 3.7 percent to 625 next year, according to JPMorgan Chase Co.
Those declines contrast with an increase of more than 5 percent for flight hours for the charter market in the October-to-September period for the past three years, according to Argus International Inc.
Industry ‘Democratization’
The increase in charter activity is partly because of the new
Article source: http://www.bloomberg.com/news/articles/2016-10-28/rise-of-private-jet-ride-sharing-crimps-orders-for-new-airplanes
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