The global scenario for air-charter services has undergone a significant transformation over the years, redefining aviation and setting the precedent for a highly autonomous mode of air transport. According to recent reports, the global market for air charter services is expected to expand with a CAGR of 5.4%, reaching an aggregate value of USD 31.9 billion this year. Moreover, this figure is estimated to almost double within a decade, attaining a valuation of 54 billion dollars by 2033. This expected CAGR of 5.4% for charter flights is a significant leap from that of 4.5% reported for the period 2018-2022. What factors are likely to cause this leap in the valuation of the air-charter market? Here’s our take:
1. Acquisition of air-charter operators by leading aviation companies
The past few years have witnessed the acquisition of several air-charter operators by leading aviation companies, paving the way for air charters’ immense popularity among flyers. For example, Vista Global acquired Camber, an online private-jet broker, in November 2022. While the latter required investments for its ventures, the former sought to broaden its horizons. Similarly, Priester Aviation acquired operator Mayo Aviation in September 2022, while Jet Linx, the seventh-largest operator in North America, acquired a Boca Raton-based southern jet. Such M&A endeavours are likely to have contributed to the increasing popularity of charter-flight services and the consequent expansion of its global market.
2. A surge in demand for cargo air-charter services
According to insights by the Global Cargo Aircraft Charter Service Market, the cargo aircraft charter service market is estimated to become a multimillion-dollar industry by 2029, with an unprecedented CAGR. North America (particularly the US) and Europe are expected to play a crucial role in expanding this industry. Following the increasing demand for cargo air charters, leading aircraft-charter companies have begun introducing cargo charter services. For example, Air Charter Service introduced its sub-brand ACS Time Critical for cargo delivery in September 2022. Cargo air charters have also contributed to the expansion of the air-charter industry overall.
3. The joy of owning one’s travel
Undoubtedly, the sheer ecstasy of flying in exclusivity is being realized globally, for business as well as leisure travel. A 2017 General Aviation Manufacturers Association (GAMA) report revealed that corporate charter-flight passengers spent two-thirds of their air-travel time working and one-third of their time connecting with clients or colleagues. Such exclusive travel time increases productivity, allowing entrepreneurs to utilize their time more effectively. Similarly, many avid travelers are opting for air-charter services, evading long airport queues and choosing their co-passengers. Such widespread use of charter jets for personal and business travel plays a significant role in the air-charter market’s growth.