The term "FBO" (fixed base operator) refers to a commercial entity that has been granted permission by an airport authority to operate on that airport and provide aviation services to the General Aviation (GA) community, such as fuel, parking, and hangar space. In smaller airports or outlying settlements, basic FBO services are often supplied by the municipal or airport authorities. However, at bigger airports, many privately operated FBOs frequently compete for the business of both permanently based and transient general aviation aircraft. The FBO's two main services are fueling and aircraft maintenance.
Segments of the Market
The Caribbean FBO market is segmented into type and application. Based on the type, the market is sub-segmented into fueling, hangaring, tie-down, parking, aircraft rental, aircraft maintenance, and others. Based on the application, the market is bifurcated into business aviation and leisure aviation, of which the business aviation segment is growing at the fastest pace during the forecast period. The increasing number of individuals with ultra-high net worth in developing countries is a one of the key factors boosting the business of the global aviation sector.
Recent Developments
Prominent players in the Caribbean Fixed Base Operators (FBO) market include Signature Aviation Ltd., Dassault Falcon Service, Bohlke International Airways, Swissport Executive Aviation, ODYSSEY AVIATION, and ParagonAviation Group, among others. These market players are adopting various strategies to sustain themselves in a competitive market. These companies are embarking on aggressive strategies such as partnerships and product launches in the FBO market to gain a leading position across the globe. Some of the recent developments in the market include-
• In August 2022, Atlantic Aviation expanded its FBO footprint in the Caribbean by acquiring Blue Heron Aviation at Providenciales International Airport (PLS) in the Turks and Caicos Islands. Through this, the company aims to serve business aviation clients in George Town (GCM) and Cayman Brac (CYB), Cayman Islands.
• In August 2022, Universal Aviation, the FBO ground services division of Universal Weather and Aviation, Inc., expanded its presence in the Caribbean market with two new Universal Aviation Certified member locations in Guatemala City, Guatemala (MGGT), and Luque, Paraguay (SGAS).
• In June 2022, Eagle LNG Partners LLC partnered with the Royal Caribbean Group to provide fuel bunkering for the aircraft companies, including the first aircraft debuting in 2023.
Conclusion
The presence of a smaller number of businesses targeting the FBO market as well as private jets across the Caribbean is the major factor accelerating the growth of the market. The steady rise in air traffic has created a requirement for new aircraft. Between 2016 and 2019, the region's air passenger traffic grew by approximately 100 million travelers. As a result of this, several market players are expanding their businesses in the Caribbean in countries such as St. Thomas Island, Turks, and Caicos Islands, among others. For instance, in February 2021, Standard Aviation opened a new luxury FBO at Cyril E. King Airport in St. Thomas, in the Caribbean. The project was funded a few years ago through a public and private partnership between the Virgin Islands Port Authority and Standard Aviation. It is the largest free-span building, with no interior columns, in the Caribbean. Additionally, new innovations and initiatives taken by market players to reduce their carbon footprint will also aid in the market’s growth. For instance, in March 2022, Signature Aviation, one of the aviation terminal operators, introduced a permanent supply of sustainably sourced jet fuel that reduces aircraft carbon emissions at the Eagle County Regional Airport near Vail, Colorado. The Signature sustainable aviation fuel (SAF) provides for a 25% reduction in CO2 emissions from jet-powered aircraft. Due to all these factors, the Caribbean market is expected to grow at a CAGR of 5.5% during the forecast period (2023–2029), according to OMR Research.