NEW YORK, Oct 21 (Reuters) - Sales of business jets areexpected reach $18.4 billion this year, up about 8 percent fromlast year, a sign of further economic strengthening despite somepockets of weakness notably in Asia, according to a forecast byHoneywell Aerospace.
The forecast expects continued recovery from the economiclow of 2009, and for growing demand for bigger jets with longerrange, including those made by Bombardier Inc andGulfstream, a unit of General Dynamics Corp.
The higher cost of the bigger jets will keep overallspending moving higher even as actual number of jets sold isexpected to be down about 1 percent compared with last yearbecause of problems in the supply chain that hamperedmanufacturing, Honeywell said.
The survey forecast up to 9,250 new business jets will bedelivered through 2023, worth more than $250 billion.
The number of jets expected to be purchased in Asia in thenext five years fell in the latest survey from a year ago. Also,the Asian share of global demand over the next five years shoulddrop to 5 percent from 7 percent, according to the survey, whichtallies purchase expectations from more than 1,500 business jetoperators around the world.
Asian buyers are expected to buy jets equivalent to 24percent of their fleet in the next five years, down from anexpected 34 percent in last year's survey.
"Purchase expectation in China held strong," said RobWilson, president of Honeywell's business and general aviationdivision. "It was the Asia component around China that dropped,"including relatively slow growth in India.
The share of global demand in Latin America held steady at18 percent the survey said, showing continued economic strength.Jet buyers are expected to replace or add to the equivalent of39 percent of their fleets over the next five years, alsounchanged. However most of those purchase were expected in thenext three years, in part because of older fleets in the region,especially in Brazil.
The share of global jet purchases in North America jumped to61 percent in the latest survey from 53 percent a year ago,partly because of economic recovery and also reflecting weaknessin Asia and Europe. The fleet turnover expectation rose to 28percent over five years, compared with 25 percent previously.
Europe's share of global demand fell to 12 percent from 18percent, the survey found, reflecting a "fairly long period ofweak growth," Wilson said. "That may improve."
European purchase expectations declined to 25 percent, wellbelow the 30 to 33 percent figure reported in the past threeyears.
The European responses to the latest survey may be skewed,Wilson noted, because there were only minimal survey responsefrom operators in Russia, which is typically a strong market.
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