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The business aviation industry is a dynamic and evolving industry that continues to experience vigorous growth across global markets. There are a variety of factors impacting the sector today, such as:
- An increase in demand for qualified pilots
- Collapse in value of used jets
- Rising operational costs
- A marked interest in private jet travel
Here are five top trends in the business aviation industry that will change the way aviation providers do business.
1. Heightened sophistication of business aviation customers.
Customer service is the driving force in the aviation industry. There are an increasing number of aircraft owners, charter clients and other business aviation customers. Growth is coming from a younger, digitally-connected generation of business leaders and wealthy citizens. While image and ego are still important to these high net worth individuals, efficiency and accessibility are playing a larger role. Increased accessibility to private aviation has resulted in an increase in the number of people who demand charter services. As a result, many customers seek aircraft that can hold enough passengers as well as meet all their baggage and catering needs.
2. Increase in regulation and safety.
Safety within the business aviation industry is the number one priority. Many private jet operators seek safety approvals through independent auditing systems. Business aviation companies continue to differentiate themselves by adding safety measures for the benefit of their clients and aircraft owners.
By the same token, increases in aircraft regulations and safety oversight will add to the costs of jet travel in the future. Implementation of safety programs that are not yet required by regulators may add an additional cost in expertise, talent and oversight, but ultimately adds savings. For example, insurance premiums significantly decrease when knowledge of how to maintain and create a safe operational environment improves.
3. Traditional buying patterns are changing.
Today’s aviation customer has many more options than to own an aircraft. Other purchase options include:
- Fractional ownership
- A la carte models
This means that business aviation service providers will need to be agile and flexible in terms of what is offered, how it’s offered and who they partner with.
4. Influence of technology.
Digital advancements are a driving force across many industries, including business aviation. Here are some of the technological advances that are having an impact on the aviation industry.
- Ground and satellite-based in-flight Wi-Fi (with speeds over 70 mbps)
- The ability to conduct in-flight video conferencing
- Charter booking systems
- Improvements to safety and situational awareness in the cockpit, such as:
- Synthetic vision
- Active side-stick technology
- Near-visible and infrared spectrum sensors
5. Increase in demand for private jet charter services.
As airline travel becomes more stressful, a higher number of individuals are opting for business aviation for comfort, privacy and convenience. The increased demand will affect the supply and cost. In response to the demand, private charter jet companies will expand their preferred membership programs, such as:
- Private jet cards
- Member plans
- Preferred charter accounts.
These preferred membership accounts will provide private jet clients access to lower rates, no blackout dates and additional fleet options.
In the future expect to see more business leaders accessing the power and benefits of business aviation services. In today’s business world, business jets are now a vital, affordable and competitive tool. The use of private aviation will allow companies to improve productivity, gain market share and outperform competitors. Watch for further trends of leveraging technology, increasing demand and an ever-growing, ever-changing market.
Marsh & McLennan Agency (MMA) offers specially designed solutions and advice built on experience, industry knowledge and strong insurer relationships to firms in the aviation industry. Our premier staff has comprehensive knowledge related to aviation risk and all aspects of the aviation industry. To find out more about our powerful resources, industry-leading analytics, risk consulting expertise and specialized knowledge of the aviation industry, contact us here.