Pre-Owned
Aircraft Market Distracted by Bottom Feeders
Carl Janssens, ASA | Aircraft
Bluebook–Price Digest
[View
the charts.]
In the pre-owned aircraft market, bottom feeders
are like red herrings.
Bottom feeders — corporate aircraft that
have no significant issues with their history, maintenance or condition
and are marketed below Bluebook wholesale values — continue to be
great opportunities for the fortunate few who buy without a blink of an
eye.
They also lead buyers into a false perception of value that
only competition in the market can correct.
Reasons why such
aggressive marketing maneuvers continue to appear are wide and varied.
When a corporate aircraft with no issues with its condition, equipment
or history sells for a low price, Aircraft Bluebook–Price Digest
investigates to learn the whole story. Capital gains, tax shelters,
foreclosures, and even new deliveries are just a few reasons behind
these significantly discounted offerings. One common denominator in all
of this is the element of time. An aggressive discount in price
represents interest in an immediate sale. True, this moves the economy,
but such a transaction does not fit the definition of Fair Market, which
the Bluebook reports as Average Retail.
Pre-owned aircraft sales
activity slowly is showing stability in the market, but news of another
bottom feeder eclipses these transactions, and market perception has to
be rebooted like after a computer crash.
Serious buyers are
starting to see beyond all the drama when an unrealistic offering is
being denied by the seller. Ready-to-fly, well-equipped aircraft with
fresh maintenance are bringing some normalcy to aircraft
values.
Although the market is still nothing to brag about, and
trends still might adjust down, this market is nothing like the roller
coaster ride of 2009. As the market slowly improves, attention to
navigating through the economy is migrating from ground to traffic
awareness.
Read more 
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