“Since the advent of COVID-19, luxury buyers have shifting to private aviation to avoid airport crowds and coronavirus variants“– Paul Ebeling
A shortage of newer-model business jets is driving up prices of pre-owned aircraft, a trend that is expected to deliver a windfall for luxury plane makers as new affluent buyers enter the market.
After a turbulent Y 2020, the rush toward private transport is so marked that some buyers are snapping up 2nd-hand planes before fully inspecting the wares as the market shifts toward sellers, lawyers and brokers said.
That is expected to push up demand for new jets from plane makers like General Dynamics Corp’s Gulfstream, Textron Inc and Bombardier Inc since buyers have fewer pre-owned options, and the price gap between old and new narrows.
“There are virtually no young pre-owned aircraft available – good news for would-be sellers and for plane makers,” said aviation analyst Rolland Vincent
Traffic from business jets, which carry roughly a handful to 19 travelers, has rebounded to pre-pandemic levels in the United States, the world’s largest market for private aviation, according to FlightAware data.
“On the pre-owned side, inventory appears to be fairly low, and that’s always a benefit to new aircraft sales,” said the senior vice president worldwide sales, Gulfstream.
“We are seeing strong interest across the board from 1st-time buyers and high net worth individuals as well as corporate customers with a desire to grow their fleets.“
Textron (NYSE:TXT)in April raised its full-year profit forecast, propelled by a rebound in business jet demand.
The trend could encourage some plane makers to increase production rates.
Planemakers do not disclose total number of orders.
Preowned aircraft for sale in May accounted for 6.6% of the worldwide fleet, the lowest level recorded in 25 yrs by JETNET data.
Have a happy, healthy weekend, Keep the Faith!