Youngest used drop 4% sequentially, 25% YOY. Available for sale business jet inventories were 7% lower y/y in August (-2% sequentially), and now represent 10.3% of the installed base, the lowest since before the financial crisis. Inventories of 0-5 year old were 4% lower in August (-25% y/y) at 5% of installed base (mid-range best at 4%), with 6-10 year old inventories also 4% Lower (-10% y/y) at 10% of installed base (long best/mid-range worst). We believe young used inventories as approaching healthy levels, which we estimate at <5% for 0-5 year and <10% for 6-10 year. Retirements low at <1% of the installed base.

Bombardier/Gulfstream 4% of 0-5 fleet available for sale Of young aircraft (0-10 yrs. old), inventory levels are lowest for Bombardier/Gulfstream at 6% (4% for 0-5 yrs. old). N America continues to look best with only 7% of young fleet available, while Europe is highest at 10%. Among young aircraft, small & large cabin 0-5 year old inventories have declined to roughly 6% of installed base, with mid down to 4%. Among large cabin, pricing appears to have stabilized for G550/G650/G650ER (Figure 2).COL/GD to benefit from improve in fundamentals Business jet fundamentals, including used inventories and pricing along with utilization, appear to be modestly improving. Both COL (Neutral rated) and GD (Buy rated) should benefit from accelerating defense growth and offer significant leverage to business jet improvement.

Business aviation flight activity in North America “sizzled” last month, recording a 5.2 percent year-over-year increase, according to TrakPak data released today by Argus International. This is the largest month operations-wise since May 2008 and shattered the business aviation data firm’s 3.3 percent growth forecast for August; it is predicting 3.2 percent this month.

Last month's results were fueled by a 10.9 percent year-over-year increase in Part 135 charter activity. Part 91K fractional flying also posted a solid 7 percent gain and, for the first time in several months, Part 91 activity was in the black, rising 0.9 percent.

Large-cabin jet activity continued to dominate the aircraft categories, climbing 7.2 percent year-over-year in August. This was followed by light jets, up 5.5 percent; midsize jets, up 4.8 percent; and turboprops, up 4.5 percent.

In individual categories, the Part 135 segment nearly had across-the-board double-digit gains, with the exception of light jets under this catergory, which rose 9.1 percent from a year ago. Part 135 turboprop, midsize jet and large-cabin jet flying soared 11.3 percent, 11.4 percent and 12.6 percent, respectively. Meanwhile, fractional light jet activity rose 17 percent year-over-year. Only Part 91 light jets recorded a slight loss, falling 0.2 percent.

Argus’s TraqPak data provides “flight-number-specific aircraft arrival and departure information on all IFR flights in the U.S., Canada and the Caribbean.”

The pre-owned business jet inventory is at its lowest rate in nearly a decade, according to data presented this morning at the seventh-annual JetNet IQ Summit in New York City. According to Paul Cardarelli, the Utica, N.Y. data provider’s vice president of sales, of the 21,870 aircraft worldwide, 2,285 are currently on the market. That equates to 10.5 percent, a level not seen since November 2007.

Rolland Vincent, founder and director of JetNet IQ, presented results from its third-quarter industry survey, noting that nearly half of the respondents believe the business aviation market is past the low point in this recent cycle, with Europe showing the most optimism at more than 53 percent. Among aircraft operators, those with midsize jets showed the most optimism (56 percent), while large jet operators were the most pessimistic, with 47.5 percent stating they believe the industry is climbing out of the trough. According to the survey, overall optimism is rebounding from a year ago, during the height of the contentious U.S. presidential election.

Likewise, the percentage of survey respondents who indicated a better than 60 percent probability of purchasing a new jet over the next year was the highest in the past two years. Of these, 57 percent indicated interest in medium jets, while nearly 40 percent said they would want a large-cabin jet.

Read Expanded Version