Brokers’ Dilemma Is Finding Good Used Jets, Not Buyers

 - September 24, 2018, 12:32 PM
With "attractive" preowned jets in short supply, buyers might be willing to overlook distinctive livery, such as this Falcon's, if the aircraft is younger and has the right cockpit/interior configuration. (Photo: Chad Trautvetter/AIN)

For the first time since the Great Recession, business aircraft brokers “are having to find aircraft for buyers, rather than having to find buyers for aircraft,” Citi Research said today after the investment firm held a roundtable discussion with a group of these brokers on Friday. “The overall sentiment was positive as brokers are busy with high transaction volumes with the potential for pricing to broadly improve over the next year,” adding that it already has some in “some pockets.”

Brokers told Citi that the key determinant to sale is aircraft attractiveness, including age and cockpit/interior configuration. “[Attractive] aircraft aren’t available for long,” said Citi Research U.S. aerospace and defense senior equity analyst Jonathan Raviv.

North America is especially strong, comprising about 80 percent of preowned aircraft sales, above the typical 60 to 70 percent average, he noted. “There’s modest wariness that it is too North American weighted and a suggestion that [aircraft manufacturers] probably want to see broader geographic improvements before raising [new business jet] production,” Raviv concluded.

Comments

If you see it, it's available, has a good pedigree, you better buy it now. IT WILL be gone in a week. In less than two years it has gone from a buyers market to a sellers market. Globalair has seen the market change over the past two years and in the last 6 months the dynamics have completely changed. The heaviest trading market of course is the US but worldwide economies are tightening also. Late model aircraft are at a tremendous pace. Though the number of units sold is slightly lower than last year (it should be noted; that we are just starting the fourth quarter, the NBAA convention is earlier in the year also).

Analytics generated from our aircraft listings show upward trends of inquiries from around the world not just the US. The current global economies will generate enough sales by the end of the 4th quarter to confirm to the manufactures and they will begin to open new jet production on a limited basis. Hopefully they won’t make the same mistake as they did in 2005-08

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