Leading Edge CEO Sees Preowned Bizjet Market Improving

Used aircraft sales have rebounded to 2019 volumes at lower prices while the U.S. presidential election could stimulate business jet purchases, according to an investor note from Bank of America Merrill Lynch based on a call it held with Leading Edge Aviation Solutions CEO Joe Carfagna. 

Sales activity at Leading Edge started to swing higher in July and has returned to pre-Covid-19 levels, Carfagna said. Pricing, however, is down between 10 and 20 percent from a year ago, with the biggest declines coming from large business jets. “Still, preowned business jets are leaving the market faster than they are coming in and the tightening of supply should help pricing to recover,” the note added.

What’s more, the note explained, business jet sales could be stimulated following the November 3 election. Carfagna explained that the re-election of President Trump could ease buyers' worries over tax law changes, thus amplifying aircraft sales. Likewise, a win by challenger Joe Biden could prompt “a short burst of sales from the same crowd” seeking to make purchases ahead of any tax law changes.

Also, the profile of the current business jet buyer is an individual who is moving up in aircraft size and ownership level such as from fractional shares to full ownership. Those buyers are looking for more control of their aircraft, Carfagna said.