Preowned business jets are now selling 45% faster than in 2019, according to the latest market forecast published by global sales broker Jetcraft. The report also contends that "the industry is in a much-needed market correction period, with a dip in both the volume and value [of transactions] in 2023."
According to Jetcraft, in the period spanning 2022 and 2023, aircraft spent an average of 129 days on the market compared to 233 days in 2018-2019. Ongoing transaction volumes are now similar to 2019 levels, while values remain higher than the pre-pandemic peak, and the company predicts a 59% increase in total transaction value between 2019 and 2028.
According to Jetcraft president and CEO Chad Anderson, the market shifts can be explained by factors such as international travel resuming and buyers "making faster, more emotional purchase decisions due to increased demand." The company is projecting $15.6 billion in revenues by 2028.
“If you step back and think about it, the obvious reason is that now we finally have some more supply," Anderson told AIN. "The demand, to me, is about the same this year as it was last year, but the benefit to the buyers is that there's more supply that allows us to fulfill their appetite through a bit more reasonable process and a timeline that buyers can live with.”
Jetcraft’s optimism represents a turnaround after a difficult two years, which can be summarized as too many buyers and too few airplanes, which he colorfully described as “a bit of a knife fight in a phone booth.” He cited a confluence of three elements that results in a healthy preowned market: “More younger inventory available, at prices that rationalize, under timelines that are manageable—those are three important ingredients that have enabled us to do more deals in the first quarter of this year than we did last year.”
Anderson explained that global instability makes long-range aircraft more attractive—and more necessary—than ever: “Obviously, those airplanes will go transcontinental, and some people absolutely require those longer-range airplanes because you can no longer overfly Russia, depending on where you're going. There is a legitimate need now for some of that ultra-long-range capability that both the Bombardier 7500 and the Gulfstream G700 offer.”
He cautioned that the private aviation industry in general is succeeding not because demand has increased, as it did in 2022 after the pandemic roughed up the market in 2020. “Demand in Europe and demand in the Americas is about the same as it was in 2019,” Anderson explained. “Basically, you had the big dip and then you had the big spike—2022 was our industry high—and now we're kind of back to normal. What’s changed more than anything is the supply.”
From Jetcraft's perspective, the European market is “a little bit muted at the moment. The higher level of demand that we're seeing expand is in Southeast Asia; for us, it's been a bright spot.” Anderson is also seeing increased activity in China.
“China is actually coming back with buyers,” he said. “For a long period of time, they were only sellers. They're back to being a buyer of aircraft on occasion. The Americas—North and South America—have consistently been the buoy of demand. We still look at Europe as steady; I don't know of any European countries that are meaningfully increasing demand right now. I don't see them dwindling, either.”
With regard to Southeast Asia, Anderson focused his enthusiasm on Singapore. “Singapore is the new financial center for Asia, just like Dubai is the financial center for the Middle East. A lot of the Chinese principals who were running into obstacles in China, in many cases, are moving some of their companies to Singapore and Malaysia to get a more free-trade-type, democratic-type approach to their business. And they’re buying airplanes.” He also sees the Indonesian capital Jakarta as a bright spot.
And demand in South America, particularly Brazil, comes as a cause for celebration: “We've never been better in South America than we have been lately. We sell helicopters, light jets, long-range cabin aircraft, and it's all across the board. All roads lead to São Paulo, primarily.”
On May 26, Axon Aviation Group announced it had chosen Jetcraft to take over its preowned business jet sales activity. Niki Rokni, the London-based group's partner and head of aircraft sales, said Axon will now focus more intently on commercial aircraft sales and leasing services.