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Air bp
The monthly news publication for aviation professionals.
IADA dealers predict uptick in sales over next six months
IADA members predict a continuation of the modest slowdown in overall deals and somewhat softer pricing. The expect a slight increase in aircraft supply for sale over the next six months.

International Aircraft Dealers Association (IADA) members have reported an uptick in private aircraft resale expectations for the next six months, as noted in the organisation's second quarter 2023 market report. There was an upswing in projections for the next six months compared to the preceding quarter and second quarter of 2022.

“IADA members, who lead the business aircraft resale marketplace, indicated a continuing normalisation of the balance between buyers and sellers, with a nearly even split between which group is driving the market,” says IADA executive director Wayne Starling. “Their view of the market is cautiously optimistic, particularly given the vagaries of the global economy.”

The perspectives and projections from IADA members for the IADA Market Report are supported by the monthly transaction activity reports submitted by IADA-accredited dealers through AircraftExchange, its online exclusive market listing portal. Results from the second quarter 2023 perception survey point toward a continuation of a modest slowdown in overall deals, as expected under such conditions, and somewhat softer pricing.

Overall deal flow in the second quarter of 2023 continued to moderate but at a relatively high level. Please note that in addition to sales data from AircraftExchange listings, the IADA market report includes data from all IADA-accredited dealer activities and transactions, reported in total.

In the first half of 2023, IADA dealers closed 542 deals, compared to 598 in the first half of 2022, a truly exceptional period in the resale industry. Looking forward, aircraft resale prices for the next six months are projected to decrease slightly, across turboprops, light jets, midsize jets and large jets.

IADA members expect slight increases in aircraft supply for sale, also across all categories, with a stable willingness among dealers to inventory aircraft for sale. Demand is expected to be stable.

Based on the member survey and sales data provided by the network, respondents expect an ongoing shift toward a more balanced market throughout 2023. By recent historical measures, new aircraft manufacturer backlogs remain strong, but talent shortages and supply chain issues are constraining the ramp-up of production rates.

Business aviation, like other leading industries, continues to face challenges with geopolitical tensions, supply chain disruptions and the possibility of a US economic recession. Still, IADA brokers and dealers continue to see customer interest in owning or operating business aircraft.

IADA members have also reported that aircraft prices and valuations have come off their 2022 peaks, but they still see reasonably strong pricing for preferred makes and models with the right pedigree. Members are also seeing good activity in the long range, heavy jet sector, but have experienced longer times to close with a slight reduction in the number of transactions.

There are concerns within the community over the collapse of a few of the charter/fractional providers, but the overall market outlook for pre-owned business aircraft continues to be broadly favourable for the foreseeable future. The report can be downloaded from the Aircraft Exchange website.

IADA dealers submit monthly transaction and activity reports. Comments from these members add context to the report:

"Overall buying interest is still present; however, buyers are now more concerned about the overall value they are getting from the purchase of an aircraft. Aircraft that are equipped well, have lower time and great pedigrees are still getting a lot of love," says James Norris of Omni Aircraft Sales in Tulsa, Oklahoma.

"More inventory coming to market daily, better more balanced buyer/seller due diligence and transaction terms and prices are going down, but at a healthy balanced market rate. We do not see a bubble bursting or any drastic price fall coming barring unforeseen major economic issues," comments Josh Mesinger of Mesinger Jet Sales in Boulder, Colorado.

"It's hard to find pilots, parts, training slots and maintenance slots, making transactions more difficult and take longer," says Walt Wakefield of Jeteffect in Long Beach, California.

"Inventories normalising which promote a delayed buyer response," says Mark Bloomer of Jet Transactions in Newport Beach, California.

"For the buyer, more supply creates more opportunities and a greatly enhanced buyer experience. Value shoppers will find their deals in quarter three, and we predict quarter four will be back to a feverish pace," notes Johnny Foster of OGaraJets in Atlanta, Georgia.

"While the number of closings in the first half of 2023 has certainly been low, the level of activity has not. As such, I am optimistic that we will have a strong second half of the year," says Zipporah Marmor of ACASS in Montreal, Canada

"Here we are back to an even market where sellers nor buyers have the edge. The industry is less and less concerned about the correction that never came (so far). Prices have decreased but at a gradual rate and not even across all sectors (larger older cabins have declined more). Inventory has steadily increased, but we have seen very few if any distressed sellers or repossessions. Guidance to clients is that we are back in a normal market with prices on average trending down seven to nine percent annually," says Frank Janik of Leading Edge Aviation Solutions in Parsippany, New Jersey.

"Demand remains stable, though supply side will ease out, bringing out some corrections to the price," says Rohit Kapur of JetHQ, Kansas City, Missouri and Dubai, United Arab Emirates.

"OEM influence is truly driving the ultimate demand," says Randy Onysko of IADA products and services member StandardAero.

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