It’s a Buyer’s Market for Older Pre-owned Aircraft

Recent market developments are currently converging to make the conditions for buying older jets favorable. Here are some of the facts that are leading experts to that conclusion:

  • Inventory of young pre-owned jets, i.e., those manufactured after 2000, is down 1.3% from the same time last year (JP Morgan).
  • Only 8.1% of the nearly 11,000 jets manufactured since 2000 are available for sale (Business Jet Traveler).
  • Inventory of older jets, i.e., those manufactured before 2000, is relatively high (Business Jet Traveler).
  • Average asking prices for business jets in all categories are down 7% from the same time last year (AIN Online).
  • The price difference between newer and older jets is significant — a Gulfstream G450 is around $36 million, while a 1996 Gulfstream G-IVSP is roughly $6.5 million (Corporate Jet Investor).

But despite the massive price differential and the years in between the two models, the difference between the jets isn’t as extreme as it sounds: “If you were to park a 1996-delivered G-IVSP alongside a recently delivered G450, many wouldn’t be able to tell the difference between the two,” says IBA’s senior aviation analyst Jonathan McDonald.

In addition to price-related motivators for buying older jets, newer aircraft models are in much more limited supply. When buyers are evaluating the pre-owned jet market, they look at the percentage of the worldwide fleet that’s currently for sale and they investigate availability on a global scale.

While popular newer-than-2000 aircraft models like the Falcon 2000EXy and Challenger are sold at a rate of about one a month, pre-2000 models are currently selling at one per quarter. The continued short supply of late-model jets should spur new aircraft sales, but in a recovering economy are more likely to cause pre-owned jet buyers to take a closer look at older jets that they might not otherwise consider.

This is good news for sellers who are looking to unload an older aircraft and perhaps purchase a newer pre-owned one. Buyers should carefully research the aircraft’s maintenance records and operational history in order to be fully informed about the aircraft’s true condition before making a purchase.

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