Private Jet Acquisitions in 2024: Is This the Right Year to Buy?
The used jet market is a fickle one. Here are some factors to consider this year for Private Jet Acquisitions.
Since 2020, the average resale value of private jets across all categories and sizes has seen a marked gain. But who’s to say with absolute certainty that the trend will continue over the next four years? As major commercial air carriers have resumed their normal domestic and international schedules, the market boom for private jets has tapered (or stabilized) slightly. Many industry experts agree, however, that strong growth of 4-6% is still projected across the entire private jet industry over the next 10 years. This year, there are many exciting developments emerging out of manufacturers like Gulfstream Aerospace as they expect to begin delivering the G700 to customers by the end of Q1. Bombardier has been steadily delivering its Global 7500 jets to customers and is planning for the release of their Global 8000 in 2025. The market demand for newly manufactured private jets strongly supports the optimism of overall industry growth projections. What remains to be seen is the effect that these new aircraft deliveries will have on the used jet market in the coming years. For many would-be jet owners, the brand new aircraft market is out of reach, so let’s explore some of the factors that will determine if 2024 is the right year to purchase a used private jet.
Who Should Wait? Who Should Pounce?
Uncertainty over things like interest rates and stubbornly persistent international trade disruptions have caused a palpable sense of apprehension among individuals and corporations approaching big financial decisions this year. Buying a jet is not for everyone and just because one can doesn’t mean they should. Buyers who are able to swing a jet purchase, so long as they can charter it X number of hours in a year to offset ownership costs, would be wise to wait. Buyers whose potential ownership situation is not dependent on offsetting costs, on the other hand, can go full steam ahead. Used jets are sitting on the market longer today than they did in 2021-2023, but only by a small margin. There is also some variability in demand based on aircraft size. Light jets are more accessible to potential buyers and therefore experience higher turnover, whereas large cabin ultra-long range jets tend to sit on the market for longer periods. Before deciding to get serious about a private jet acquisition this year, a prospective buyer should consider how many hours they plan to fly each year and whether a jet purchase is actually the right choice. With the growth expectation of the private jet charter segment, there will still be ways for infrequent fliers to leverage the benefits of private air travel without the financial burden of aircraft ownership.
Variables to Consider
“Past performance does not guarantee future results” is an adage worth remembering when deciding to buy. If the decision to purchase a jet in 2024 is heavily influenced by the prospect of turning a profit on the asset a few years down the road, then walk away. There are smarter investment decisions one can make than hoping the used jet market continues its upward trend as projected. Many experts of their respective fields have been wrong about projections in the past. When shopping between aircraft that are available, consider how up-to-date avionics components are and how recently engine overhauls were completed. A buyer caught unaware of these important variables might be surprised when a costly update or engine overhaul falls into their lap less than one year into aircraft ownership. The smartest plan of action is to be prepared for unexpected aircraft maintenance costs to occur within a year of ownership no matter how unlikely. Buying a jet in 2024 is a smart decision for those who are prepared to handle the fickle nature of the market and have the capacity to safely realize a financial loss on the purchase should it occur. While all signs point towards industry growth, one must remember that any number of variables can reverse the trend almost overnight.