Worldwide elections and the resurgence of private jet flights in China are two key factors, among others, likely to shape the private charter industry this year, predicts Air Charter Service.
More than 2bn voters will head to the polls in 2024 across 50 countries – including US, India and UK – according to the World Economic Forum. The elections will have a dual impact on charter. “The biggest thing that may affect the market this year, is that more than half the world’s population will be heading for the polls over the next 12 months,” said Andy Christie, group private jet director, Air Charter Service. “This will mean both politicians trying to boost economies in the run up to elections but coupled with uncertainty around long term projects pending the results of the polls. The US economy in Q4 will certainly be affected by the November 5th presidential election,” he said.
The US charter market shrank by around 4% last year, but is still more than 20% up on pre-pandemic figures, according to Air Charter Service.
Charter in China
Charter in China showed particular potential. “I expect the Chinese private jet market to continue thriving after it really picked up again last year,” said Christie. “Long-range flights to Europe and the US became more popular and we expect this market to remain strong, as long as the geopolitical landscape remains stable.”
But global stability was far from assured in an increasingly volatile world. “A major concern this year is the increasing volatility in the Middle East, despite the surge in entertainment, being driven by Saudi Arabia,” he said. “The fragile nature of the current environment and potential effect on oil prices could derail the economic outlook, which would have a far wider reach than just the local markets.”
Elsewhere, the southern hemisphere markets of South America, Africa and Australasia made a quicker recovery post-Covid than some economies. All three are likely to continue to grow in the year ahead.
European flights saw an 8% fall last year compared with 2022, but they remained 7% ahead of pre-pandemic levels. The company predicts private jet levels will remain similar this year, staying ahead of 2019.
Limited by shortage of pilots
But a potentially strong summer may be limited by a shortage of pilots and parts. “Both are still an issue for airlines, including the larger charter companies in the major aviation hubs, which could further impact the number of airlines and aircraft available on the market,” said Christie. While capacity should be too much of a limiting factor for the rest of the year, if it is that could offer an opportunity for the company. “We would expect to be approached to source replacement capacity from the global market.”
The combination of so many economic and political factors made it difficult to make firm predictions. “Overall, we think that flight levels will remain relatively flat, year-on-year, potentially with a slight increase in the first half of the year,” said Christie. “But this is likely to be offset by a decline in the second half as the uncertainty of elections potentially putting the decisions on long term projects on hold.”
Meanwhile, Don Dwyer, managing partner, Guardian Jet discounted suggestions that the 2024 US election is likely to curb pre-owned jet sales. While acknowledging some impact on sales linked to the 2012 election, he detected no impact in 2016 and 2020. “I just don’t see anything to slow down the train,” Dwyer told our Corporate Jet Investor London 2024 conference last month.
