Despite all of the talk about reducing our dependency on oil, we are unavoidably compelled to live in the "Hydrocarbon Age," well into the foreseeable future. Even though oil prices have dramatically declined from their highs this year, they still pose a severe, long-term burden on the global economy and aviation.

To save money on fuel, more and more operators are cutting back on flight hours, flying slower, and using airports with more than one FBO to gain competitive pricing.

OEMs are stepping up to the plate, too, by implementing numerous fuel-saving aerodynamic improvements, such as winglets and body strakes, for all types of aircraft. They’re also making MRO procedures more energy efficient.

I spoke about these issues with Michel Merluzeau, principal of G2 Solutions, an aerospace consultancy. A keen analyst with a strong contrarian streak, Michel put today’s economic conditions into perspective. "I am very, very worried about this economy and how it will affect aviation," he told me. You’ll probably recognize Michel’s name; he’s a frequent speaker on Aviation Today webinars.

In my various interviews lately with aviation insiders, the number one issue on most minds is how broader economic turmoil could adversely affect aviation, and by extension, the MRO market. That said, many people I spoke with remained cautiously optimistic, pointing to a backlog of orders and continued demand for aircraft. For example, Honeywell’s Business Aviation Outlook, released at the NBAA Convention in October, belied concerns that aviation is entering a new recession.

For the fifth year in a row, Honeywell’s closely followed outlook pointed to an upward trajectory for deliveries and sales, forecasting up to 17,000 new jets from 2008 – 2018, worth more than $300 billion.

Honeywell sets the "gold standard" in our business when it comes to making predictions, and at NBAA the company provided plenty of reason for good cheer.

"Aircraft backlogs currently equate to nearly three years worth of deliveries, so 2008 and 2009 still shape up to be strong years for the industry," said Ron Wilson, president, business and general aviation, Honeywell Aerospace. He said that year-to-date aircraft deliveries have increased 22 percent compared to the same period in 2007. Total new business aircraft deliveries for 2007 were 1,020; Honeywell projects that number will rise to 1,200 by the time 2008 is over.

These issues will surface at our next webinar, "Aircraft Valuations in the Coming Year: The Trends of 2008 and How They Will Affect Values in 2009", scheduled for Thursday, Dec. 11, from 11:00 a.m. to 12:00 p.m. (ET). The speakers will explore the direction of aircraft values, as this turbulent year ends and we head into 2009. The panel includes Paul Leighton, editor-in-chief of Aviation Today’s sister publication, Aircraft Value News. For more information about Leighton’s publication, or to register for this webinar, go to www.AviationToday.com. The webinar will be archived and available, on demand.

Our panel of experts will discuss the future of aircraft values in the coming year, examining both the potential downsides and upsides. Despite the uncertainty now gripping aircraft valuations, plenty of moneymaking opportunities exist for those who possess a clear head and the right data. That’s especially true in the MRO market, which is characterized these days by technological innovation and entrepreneurial energy.

You’ll learn whether current woes at AIG’s subsidiary, the International Lease Finance Corporation (ILFC), will restrict access to capital in the aviation sector; how environmental issues will come into play; whether older, maintenance-intensive aircraft are doomed; how the increasing prevalence of PMA parts will affect values; whether the global economic contraction will accelerate — or impede — consolidation in the MRO sector; and more.

Planemakers’ global airline customers are on course to post losses of USD$5.2 billion this year, because of still-high oil prices and a global economy that is seriously weakened by the credit crunch, the International Air Transport Association recently reported. As 2008 ends and we look toward 2009, opportunities for growth exist but first we’ll have to fly out of some rough skies.