The Two:Nineteen

2 working days down in December, 19 remain. Here are 3 ways to make the most of the rest of 2024. Let's go!

ONE: Catch up to news you can use from the last seven days. Hopefully you had an opportunity to enjoy a long weekend that recharged your batteries. While you were away, the business aviation and aerospace industries have experienced several significant developments:

Stock Market Movements:

• Joby Aviation and Archer Aviation: On December 2, 2024, Joby Aviation's stock declined by 9.4%, while Archer Aviation saw a more substantial drop of 23.7%. These downturns occurred despite previous gains in November, where Joby shares rose by 86% and Archer's by 204%. The sharp decline in Archer's shares was primarily attributed to the unexpected resignation of Stellantis CEO Carlos Tavares, making investors anxious about the future of Stellantis' relationship with Archer. Via BARRONS

Corporate Developments:

• Vertical Aerospace: Founder Stephen Fitzpatrick lost controlling interest in the company following a refinancing deal with hedge fund investor Jason Mudrick. Mudrick converted $130 million of his loans into a 70% equity stake, reducing Fitzpatrick’s ownership to 20%. This move was necessary due to financial challenges, including a significant drop in market value after a prototype crash and the withdrawal of Rolls-Royce from the venture. Despite these setbacks, Vertical Aerospace now has $50 million in new equity to continue operations for the next year. Via The Times

Financial Performance:

• Embraer: The Brazilian aerospace manufacturer reported robust third-quarter results, with revenue increasing by 32% to $1.69 billion and adjusted earnings per share rising to $1.20 from 18 cents the previous year. The company maintained its 2024 revenue forecast of $6 billion to $6.4 billion but adjusted its commercial jet delivery forecast to 70-73 aircraft from the previous 72-80. Embraer delivered 59 aircraft in Q3, a 37% increase compared to the same period in 2023, and its backlog reached a nine-year high at $22.7 billion.Via IBD

Operational Highlights:

• EasyJet: The airline reported a one-third increase in pre-tax profits, reaching ￡610 million during the summer. CEO Johan Lundgren attributed this success to the airline's all-Airbus fleet, which helped avoid issues related to Boeing and Pratt & Whitney engines that affected competitors like Ryanair and Wizz Air. Via BI

Industry Challenges:

• Airbus: The European aircraft manufacturer is facing challenges in meeting its delivery targets due to persistent production delays and supply chain issues. Despite a record number of orders in 2023, Airbus had to cut its end-of-year delivery target and push back production goals. Analysts remain skeptical about Airbus achieving its revised goals, and supply chain issues are expected to persist for the next one to two years. Via FT

TWO: Stay on top of year-end events. Don't let your foot off the gas. These developments and strategic focuses are expected to shape the business aviation and aerospace industries as the year concludes:

Upcoming Earnings Announcements:

• AeroVironment Inc.: Scheduled to release its earnings report on December 4, 2024. Analysts anticipate an earnings per share (EPS) of $0.69 and revenue of approximately $177.06 million. Via finlogix

Industry Events:

• MEBAA Show 2024: Taking place from December 10 to 12 in Dubai, this event serves as a premier platform for the business aviation industry. It will feature over 145 leading exhibitors and more than 55 speakers discussing market trends and innovations. Via MEBAA
• ICAS Convention 2024: Scheduled for December 9 to 12 at the Paris Hotel in Las Vegas, this convention is a key gathering for the air show industry, offering networking opportunities and industry insights. Via Exponents BLOG

Operational Developments:

• Airbus Production Challenges: Airbus is striving to meet its delivery targets amid ongoing production delays and supply chain issues, particularly affecting the A321neo model. These challenges may influence delivery schedules and financial performance in the near term. Via Financial Times (Behind paywall)

Leadership Focus Areas:

• Supply Chain Management: Leaders are concentrating on mitigating supply chain disruptions to maintain production schedules and meet delivery commitments.
• Technological Innovation: Emphasis is placed on integrating advanced technologies to enhance operational efficiency and maintain competitiveness.

Sustainability Initiatives: There is a growing focus on developing sustainable aviation solutions to align with environmental regulations and consumer expectations.

THREE: Jump out of bed, roll up your sleeves, and get after it! As the final business days of 2024 unfold, investors are closely monitoring sectors such as energy, transportation, and business aviation for alternative investment opportunities.These developments indicate that investors are focusing on sustainable energy and transportation solutions, infrastructure investments, and innovative technologies in business aviation as alternative investment opportunities in the closing days of 2024. Here are areas to focus on with the remaining hours and dollars available:

Energy Sector:

• Renewable Energy Investments: Global investment in clean energy technologies is expected to reach $2 trillion in 2024, nearly double the investment in fossil fuels. This surge is driven by the energy transition and the growing demand for sustainable energy solutions. Via IEA.org
• Sustainable Aviation Fuels (SAF): The aviation industry is increasingly investing in SAF to reduce carbon emissions. However, concerns have arisen regarding potential policy shifts under the new administration, which could impact the development and adoption of green jet fuels. Via Reuters

Transportation Sector:

• Electrified Transport: Investment in electrified transport, including electric vehicles (EVs), reached $634 billion in 2023, marking a 36% year-on-year increase. This trend is expected to continue, presenting opportunities in EV manufacturing and related infrastructure. Via bbHub
• Infrastructure Development: The anticipated increase in dealmaking activity under the new administration is likely to benefit sectors such as infrastructure and energy, potentially leading to new investment opportunities. Via BI

Business Aviation:

• Electric Aircraft Development: Companies like Beta Technologies are advancing electric vertical take-off and landing (eVTOL) aircraft, with plans to establish manufacturing facilities and expand operations, signaling growth potential in this sector. Via Wikepedia
• Supply Chain Solutions: Companies specializing in jet-engine leasing and repair, such as FTAI Aviation, are addressing engine shortages affecting airlines, offering alternative investment opportunities in the aerospace supply chain. Via WSJ

Market Performance:

• Energy Select Sector SPDR Fund (XLE): Currently trading at $94.45, with a slight decrease of 0.08%.
• iShares U.S. Transportation ETF (IYT): Trading at $73.53, down by 1.32%.

U.S. Global Jets ETF (JETS): Trading at $24.59, a decrease of 0.37%.

Let me know how we can help you make the most of 2024, and make the best of 2025. I remain at your service.