The anticipated softening of the global economy in the next few years would present an opportunity of significant growth for trade in pre-owned business jets which would surpass the deals in new plane deals by four-to-one. This prediction was made by Jetcraft Corporation which is a United States based company that offer sale, lease, and buying services of aircrafts. The firm’s forecast is for a period of the next five years.
Those customers who were in the habit of only purchasing new aircrafts are now “more willing to consider pre-owned”, said Jahid Fazal-Karim, Owner & Chairman of the Board at Jetcraft, in a statement that accompanied the forecast report.
Over the next five years, there would be trade deals for 11,765 pre-owned planes according to the anticipation for the new forecast. The report also states that those deals would be equal to $61 billion in value and similar to delivery of 3,444 new which would be valued at $90.5 billion.
“New delivery units are forecast to flatten out as a result of an upcoming economic downturn, while pre-owned transactions continue to grow,” said the report analysis.
With respect to options for refurbishing and maintaining an existing plane, there are much better options available now which can be seen by the individuals and businesses who were in the market for a private jet, Fazal-Karim said.
The report and the market analysis includes a range of aircrafts in terms of size and capacity – from the light jets that has a capacity of carrying only 4 passengers to large converted airliners. There is much better value of old aircrafts in the second hand market because the extension of the average age of retirement for a business aircraft is not pegged at at least 32 years, stressed the analysts in the report.
The annual value of the deals for private jet for the global industry would touch a figure of almost $30 billion by 2023, said the report from the analysts of Jetcraft. That estimate is a huge boost for optimism in the overall market when considering the fact that the entire jet industry is yet to recover from the shocks that it faced in 2008 when just about 1,100 planes were delivered worldwide.
The anticipated greater scope for the industry, according to the report, is also driven by the fact that the focus of expending and investing by the executives in large-listed firms have shifted to areas such as share buybacks, stock dividends and paying down debt in the recent years unlike the trend in tester year, Jetcraft has previously said.
Additionally, an increasing preference for larger and more expensive jets is also the reason that there has been a reduction in planes being actually bought, apart from the trend of reduction of expending in such areas. Te global market for both the pre-owned and new plane markets would see witness this growing trend in a continued manner, Jetcraft said.
(Adapted from Business.co.uk)