William Blair recently released their quarterly aviation services and industry update. The report highlighted concerns in and trends in the FBO space including the continuation of embracing electric aviation, hangar shortages and commercial travel delays and cancellations.
Here is what you need to know:
- Hangar Shortage: The shortage of hangar space for aircraft owners persists into 2024. This shortage is attributed to several factors, including the prolonged useful life of aircraft, the trend toward larger aircraft, and the limited capacity of existing hangars. The demand for hangarage is outstripping supply, driven by larger aircraft designs and growing deliveries of business jets.
- Commercial Travel Challenges: Commercial airlines are facing significant challenges, including shortages of pilots, aircraft, and air traffic controllers, leading to increased flight delays and cancellations. The Department of Transportation received a substantial increase in complaints in 2023 compared to previous years. Delays in aircraft deliveries to airlines, particularly Boeing 737 and 787 models, are also causing problems for the industry.
- Shift to Private Aviation: Many travelers shifted to private aviation during the COVID-19 pandemic and have continued to do so. This trend may continue if commercial aviation does not improve significantly in the coming years.
- Electric Aviation: In response to environmental concerns and technological advancements, the aviation industry is embracing electric aviation. Companies like Atlantic Aviation and Beta Technologies are partnering to install electric charging stations at fixed-base operators (FBOs). These initiatives aim to enhance sustainability in the aviation industry and meet dynamic market demands. Similar investments are being made by other key industry players, highlighting a dedication to reducing carbon emissions and transitioning toward sustainable aviation practices.
