Report: Demand Turns Jet Market Upside-Down
Used jets are selling for higher prices than new jets in today's hot marketplace, says a report this week in The Wall Street Journal. For example, a Gulfstream G450 from the factory sells for about $40 million, but used ones are selling for $44 million and up. "That's because you can fly it next month, instead of the first quarter of 2013," Matthew Hartnett, a Gulfstream sales executive, told the Journal. The topsy-turvy market is also attracting speculators who will buy up delivery slots then sell them at a profit a year or two later. "If you need a plane in six months you have to go and buy a position from someone," Paolo Carmassi, president for Europe, Middle East, Africa and India for Honeywell Aerospace, told the Journal. "And there are people who are making a business out of selling their positions."
That practice makes manufacturers nervous -- if the market takes a downturn and demand dries up, they could be left with a surplus of airplanes and no buyers.