With sales of new business aircraft relatively flat, the used market has been enjoying a burst of activity for almost two years and may improve further as the economy gains steam. “We’re seeing a lot of pent-up demand as a result of the slow growth of general aviation for the last seven to eight years,” says Matt Huff, VP of Ogara Jets, an Atlanta-based brokerage. Other brokers have said sales have yet to recover to pre-2008 levels and the outlook isn’t expected to change much until beyond 2020.
The OEMs are simply building jets faster than the world market can absorb them. Huff said that has proven positive for sales of used aircraft because new aircraft typically depreciate about 10 percent a year, so a five-year-old jet with essentially the same performance as a new model can be bought for a little more than half the price.
“We’re seeing a very active market for the Gulfstream 200 because of its capabilities compared to its current price,” Huff told us in this podcast recorded at NBAA-BACE in Las Vegas this week. Mid-cabin airplanes like the Citation XLS are also strong sellers. Huff said some buyers plainly see value in used airplanes and aren’t hung up on having one that no one else has flown.
“It’s a financial question, not an airplane performance question,” he says. “With new airplanes, there are tax advantages for some companies and they use that as a justification for acquiring a new airplane.”