Late Model Gulfstream availability

Aviatrade has been offered quite a number of off-market, nearly new G450′s in the past few weeks. Some brokers have seen deals ‘blow-up’….thereby creating opportunities for quick access to this still-hot sector. Apparently even a couple of Russian buyers got cold feet.

Two 2011 models with very low hours can be bought in the low-$30MM’s…both forward and aft galley are available.

There’s even a brand new 2012 model that can be bought in the mid $30MM’s…….whilst this is the same price as a new factory G450, clearly the immediate access and instant operation are worth a premium, provided that the interior is attractive (and this can quickly be remedied if anything is not quite right).

Similarly, a couple of “hot-ticket” G550′s have come our way…one is a September/October brand new delivery. Natrually, calls to the Gulfstream factory in Georgia will not uncover this opportunity because position owners do not want ‘Savannah’ to know their business. The same goes for a Gulfsteam G650 position that we can offer directly from a cooperative seller.

There are still plenty of Gulfstreams available in the pre-owned publicly available listings.

Gulfstream IV/IVSP are feeling lots of market pressure and prices show no signs of improving. This is definitely a market where a discerning buyer will score a big hit in terms of value for money. However, these jets must be carefully evaluated, but some forensic records work and a tightly focused pre purchase inspection will pretty much guarantee that a “discount Rolls-Royce” will be available in the hangar.

The Gulfstream GV is also feeling some pain, whereas only a few months ago, brokers were licking their chops over the selling possibilities……demanding silly high $20MM prices  for nearly twenty year old jets.

More on the other brands shortly, meanwhile we’d like to hear from anyone who is eager to buy any of the aforementioned jets.

A Snapshot of Chinese Life

….Right here in Los Angeles one can catch a glimpse of what to expect upon visiting China.

I was recently paying my annual visit to the China Consulate on Shatto Place, downtown LA, for visa renewal.

Previous visits have been pretty much routine with the occasional bureaucratic sideswipe. However, this visit was quite the circus;

The usual LED notice board that alerts waiting visa applicants to their turn at the counter windows was broken. This meant that instead of a quiet few minutes sitting on one of the arena-like bench seats, every applicant had to stand in line with a numbered admission ticket given to us by the very pleasant security guys at the front door.

This line extended around the entire waiting area like some sort of homage to the Year of the Dragon. So, instead of being able to sit and contemplate the upcoming noodles and Baijiu consumption, we all shuffled along for a good hour (threading our way between the seats) with nothing to do except stare at the CCTV news show that was silently portraying life in China as it will be when we get there.

The simple interim solution (who knows just how interim?) would have been to have one of the counter staff call out numbers (in Chinese and English) and the rest of us could have waited on the benches for our turn…..this was apparently too logical for this office…when I suggested the ‘improvement’ to the girl behind my counter window wearing the blue surgical gloves, she stared at me as if I’d just asked her to marry me.

Based on my many visits to China over the past few years, this is pretty much the existence that the locals are subjected to…not a lot of lateral thinking and absolutely zero idea about customer service. However, China is never dull and the further west one travels, the more interesting life gets.

Jet Fuel Prices Threaten Gulfstream, Bombardier and Falcon Pre-Owned Sales

Here we go again……a ruckus in the Middle East and already creeping jet fuel prices….!

It’s no surprise to any Gulfstream, Challenger or Falcon owner/operator that these sudden, steep jet fuel price increases can take forever to subside and are never fully reversed.

This time around, the price increases will weaken already moribund pre-owned aircraft sales activity and will, more than likely, pile more inventory on top of the pre-existing and mostly stagnant stockpile of most makes/models…including the ever-vulnerable Spey-engined Gufstreams and vintage Falcons/Challengers/Hawkers.

The usual suspects are forecasting up to a 20% increase in the price of jet fuel over the next few months, this increase includes what might be termed a “war-risk premium”…..anyone in the aircraft broker business may as well take a long summer vacation.

However, anyone sitting on a different pile (of money) can be assured of plenty of leverage if any of the segments such as Gulfstream IV, IVSP, V or Global Express…or maybe even Falcon 900B/EX are under consideration. Aviatrade is aware of plenty of tailwind in this case.

…….stay tuned for pre-owned Gulfstream, Bombardier, Falcon etc., sales forecast “adjustments”.

Gulfstream Aerospace to feed at the aircraft brokerage trough

An interesting announcement from Gulfstream recently;

Essentially, Gulfstream will be offering brokerage services to any Gulfstream owner who will let GAC list their Gulfstream aircraft for sale.

This is no doubt an effort to give GAC’s pre-owned sales people something to do. Gulfstream ended 2011 in the remarkable position of having no pre-owned aircraft for sale……this is both a testament to the pre-owned sales department skills and the strength of the product line. However, the fact there are still some hundred plus (discounting the Spey-engined jets) Gulfstreams for sale indicates that there is a lot of competition in the brokerage arena (not so much in Aviatrade’s consulting arena)

Don’t get me wrong here, I know most of the pre-owned sales chaps (and chapette) quite well, but this new development does sort of present a conflict of interest for Gulfstream…..to wit; if and when Gulfstream ‘bulks-up’ on pre-owned offerings, the sales people will theoretically be pitting their own inventory against the ‘allcomers’.

Incidentally, this is akin to the legerdemain that some in the aircraft dealer network have been known to indulge in when performing a ‘bait and switch’…. by advertising a customer’s jet for sale, then telling serious enquirers that ‘we may be able to offer a better deal on a different jet‘…..(ie., one from their own inventory). I will stress that I am by no means inferring that Gulfstream pre-owned sales would ever indulge in such antics.

Nevertheless, picture this hypothetical scenario…..Gulfstream pre-owned has three G550′s in inventory in the near future as a result of G650 delivery trade-ins. Obviously Gulfstream’s ‘delta’ will be built in to any trade-in. This then potentially allows Guflstream to offer their inventoried G550′s at a lower price than any other G550 that they may be brokering for an ‘external’ customer…..a little tough on the ‘ethics committee‘ side of things, (any assurances re.transparency and market comps/summaries notwithstanding)…..It’s pretty hard to argue that any perceived advantage of Gulfstream proprietary customer-base/product knowledge etc., etc., outweighs the potential for bias (no matter how innocuous) in GAC’s pre-owned Gulfstream transactions. This will be especially tricky if we see another marked economic downturn and accompanying flood of distressed sales.

In any event, we’re pretty confident that Aviatrade’s almost thirty year affiliation with the Gulfstream brand coupled with our competitive fees will offer a persuasive case for retaining Aviatrade when the Gulfstream buyers and sellers “come a knockin’ on our door”.

Hawker Beechcraft Woes

"Hawking Beechcraft"

…..There’s nothing wrong with HB that a change in top (very top) management wouldn’t help.
Who else is a little tired of hearing Boisture blame everything in sight except the ivory tower occupant ?
Re. a partial comment from Boisture someway down this article “deceleration in China’s economy hampering growth”….say what ?
…And interestingly perhaps, the commentary continues with “His (Boisture’s) cautious outlook contrasts with more optimistic views elsewhere”…..when will his ‘Goldman’ masters (who apparently put Boisture in HB’s corner office in the first place) finally “get it” and move him on to his next plum assignment ?
Boisture, it is alleged, left Gulfstream under a cloud (no pun intended) some years ago and was apparently only at Netjets and Carlyle Group until his ‘sell by” date came and went at both companies.
It doesn’t help matters that the Hawker line is now seemingly moribund (sad to say) and distinctly unexciting…but this will be the challenge for the next CEO, who surely can’t be too far over the artificial horizon now that a downgrade has occurred. But will it happen soon enough to avoid the B-word ???

Aviatrade announces supersonic market entrant

the competition....

HyperMach Now Aiming for Mach 4 Bizjet…….

So, fellow cloud-stabbers, we now have ‘Hyper Mach’ or whatever the latest hyperbole-laced earth-bending starship is called……Rising to this latest challenge, Aviatrade is not going to stand on the sidelines (or in any hangar bathroom stall) while some johnny-come-quickly outflanks us with some tricky wicker-basket-based technology.

Therefore, we are announcing, with some fanfare (and jet-engine-money-sucking noises), our breakthrough market-stomping jet….the MegaHypaZoom(Mach) bizplane.

This unbelievable (sic) pocket rocket will travel at many many times (so many we’ve lost count already) the speed of light. In fact, it will be so quick, it will arrive before it departs…..brilliant huh ??? This of course means that we will save lots of fuel and passengers will actually look younger as they slide down the escape chutes after the botched landing by our incapable crews (did I mention that it only needs a forty-thousand foot airstrip for landing and take-off).

Speaking of fuel, we have secretly developed (in a deep disused Minuteman silo littered with defunct taxpayer-funded top secret plans for Armageddon) a tree-burning ultra-high-reverse-bypass engine….therefore the MegaHypaZoom(Mach) will be congruent with present-day ‘green’ fuel fakers and carbon-footprint collectors etc etc…..and, (wait for it), we intend to burn only trees dredged from submerged ancient forests and thereby re-inject good old H2O back into the edge of the atmosphere…….ingenious plan is it not ? (and oh, I forgot to mention, there will be a solar-powered log-splitter that will be installed in the space where the cabin crew would normally sit and read the free newspapers and eat passenger leftovers….aka the “galley”).

Of course, we’re not putting up any of our own money for this little jape, (we’re not stupid)….instead, we’re desperately hoping to bamboozle an unsuspecting OEM and suck up some of that there ‘gomment’ (aka tax payer) moola that seems to perennially disappear down these whizzbang jet transport concept black holes. Actually, as previously stated, there won’t be any black holes with the MegaHypaZoom(Mach) …..because it’ll be too bloody quick !

We know that all of you aircraft spotters will be very excited to hear about the MHZ(M) and we are cautiously optimistic about our chances of fooling everyone that we come into contact with in the aviation world and beyond (……Mars ?).
However, as with all such wildly ambitious and foolish designs, we are taking some precautions with regard to testing market acceptance….to this end, we are going to ask one of our dogs (the chocolate Havanese) to give it the ‘sniff test’….because as we all know, it takes one dog to know another !

Pre-owned aircraft market and new aircraft positions

Last Fall we acquired a Gulfstream G550 for a client. This was, (by necessity) an off-market transaction….(the seller was the daughter of one or another of the Russian oligarchs).
Since that time we’ve watched the uptick of G550 availability and almost across the board in the ultra-long-range aircraft category.
G550, Global Express and Falcon 900EX have all become more plentiful on the pre-owned market (fifteen G550′s at last count) and this of course means good deals for buyers. We are seeing early-model G550′s that can be acquired for less than what appears to be the top of the pre-owned G450 market.
Gulfstream GIV’s and GIVSP’s are plentiful and very much in a buyers’ market, but with not too many good GIV/SP’s in the mix. GIVSP’s have trebled in availability since last Fall. Some of this availability is probably due to anticipated owner replacement/upgrade aircraft but we doubt that fifteen G550 sellers are all moving up to G650 or across to Global Express XRS’s.
Other segments of the market have shown similar increases in availability with Challenger 604′s and 605′s also very soft. Same goes for Challenger 300 and thereon down the cabin size/performance chain.
Falcons (2000′s/900B’s) are in a buyers’ market and will stay there for the foreseeable future.
Many older models have reached the point where the mantra is “buy it, fly it, scrap it”….all Spey-engined Gulfstreams, early Lears, early Challengers etc will all be retired as they reach critical inspections and engine limits.

Aviatrade has good access to numerous positions for Gulfstream G650, G550, G450, Global XRS, Global 5000 and Falcon 7X, Falcon 2000LX and Challenger 605, but as always, these positions are in demand and buyers should be prepared to act quickly and decisively in order to be the early-bird catching the worm.
So let’s go hunting…..for aircraft !

NBAA 2011 and the China orderbook syndrome

Per my previous sign-off….NBAA, October 2011, Las Vegas was apparently the appropriate venue for the latest announcements (orders ?) from the current crop of China bizav neophytes
…to wit “I’ll see your fifteen Gulfstream 550′s and raise it seven XRS’s”…..okay, I’m going all-in with my five Falcon 7X’s“….(yawn).

In our opinion this was nothing more than ‘headline-grabbing’ and we predict a ‘slight tempering‘ of these puzzling announcements in the near future. It wasn’t too long ago that a certain China-based financing entity was imploring us to ‘help sell‘ two ultra-long-range jets that were somehow stuck in their order inventory….ultimately these jets disappeared into the hotpot that is currently business aviation in China.

The inference here is that this particular financing entity was not purchasing these jets on behalf of qualified clients in the first place….au contraire, this ‘entity’ was speculating, marking up the price and then looking for buyers….at some pretty steep finance rates…nothing has changed.

Of course, there is also the other end of the food chain at the smorgasbord…..brokers in the US and elsewhere are now conditioned to listening for the clatter of coins (Vegas style) when the ‘phone rings with an ’86′ caller ID. The internet is playing havoc with the past mystique and cadence of both the new and pre-owned markets and certain China-based brokers are busy mimicking some of their ‘foreigner’ counterparts…..right up to and including the self-dealing and corruption that are so often evident when lots of money collides with an unregulated and lucrative business opportunity.

More on China after the year of the Black Water Dragon gets under way.