JETNET

JETNET Releases June 2014 and First Six Months of 2014 Pre-Owned Business Jet, Business Turboprop, Helicopter, and Commercial Airliner Market Information

JETNET Business Aviation Market ReportUTICA, NY – JETNET LLC, the leading provider of corporate aviation information, has released June 2014 and
the first six months of 2014 results for the pre-owned business jet, business turboprop, helicopter, and
commercial airliner markets.
Market Summary

Highlighted in Table A below are key worldwide trends across all aircraft market segments, comparing June 2014
to June 2013. “Fleet For Sale” percentages for business jet and commercial jet market sectors were down in the
June comparisons, but stayed the same or increased slightly in the other markets. This is the lowest percentage
(11.8%) for business jets that we have seen since the great recession began. However, the total number for sale
is still well above the 2,300 mark.

Some very good news! Business jets are showing a strong start in the first six months of 2014. Along with an
8.5% increase in pre-owned sale transactions, they are taking less time to sell (57 days, or nearly 2 months) than
last year. This is likely a direct result of an 8.2% decrease in average asking price. Adding to this good news:
GAMA reported that new business jet deliveries are up 12.4% in the first six months of 2014 compared to 2013.
Conversely, business turboprops decreased 16.1% in sale transactions, with a double-digit decrease in asking
price of 14.4% as well.

Both turbine and piston helicopters saw declines in YTD sale transactions, down 9.9% and 15.8% respectively.
Turbine helicopters recorded an increase in average asking price, at 14.9% in the YTD comparisons through June
2014. The turbine helicopter market segment was the only one to show an increase in average asking price. The
other market segments all showed decreasing asking prices compared to last year.

Read the full report (PDF)

JETNET

Guest Post: The Devil is In the Details

We thought this post from Janine Iannarelli of Par Avion Ltd. Reposted with permission.

Remember when being attentive to detail was a standard to which all others aspired? If you offered a bespoke service, you were expected to deliver well beyond expectations. Mediocrity had no place in a work environment that strives for excellence. It was not okay to let things slide as doing so meant leaving the door open for your competition to show your prospects how they can do it better. This is my soapbox for the month so I am going to play devil’s advocate when it comes to the subject of details. I am still a big believer in always reaching for perfection, which I know in reality is never attainable. Blame it on my competitive nature and having been through some tough schools in both the formal and informal educational setting. A bar set a little out of reach should make you try that much harder. My disappointment is not just in those whom from time to time I encounter think “just okay” is acceptable, but also with those who dismiss all the things that lead up to achieving as close to perfection as impossible. Or worse, it’s always someone else’s fault as to why they didn’t get the job done. I just want to get out the pitchfork whenever I hear that particular compliant.

As a long-standing member of the business aviation community I feel that we business aviation veterans are somewhat obligated to hold ourselves to a higher standard regardless of what it is that we do. Certainly I see that culture of excellence for the most part in the operational, maintenance and the management side of the business. It’s one reason why there are at least a couple of layers to the aforementioned as we don’t just rely on one person having checked a box, particularly when it comes to returning an aircraft to service. A detail oriented line mechanic is a job requisite. Just as a detail-oriented customer service representative makes or breaks their company’s image. A detailed-oriented salesperson wins friends and influences others and sets his or her sales on fire!

Remember high school English class (insert language of choice here) when your composition paper got graded on not just content, sentence structure and flow of the material, but also on spelling? The absolute easiest part of the paper was making sure that each and every word utilized in your report was correct. Heck, long before the spell-check software feature there existed such a thing known as a dictionary and presumably at a much younger age you were taught how to use it. Theoretically, today one’s spelling should be perfect given the ability to “spell-check” your document, auto-correction aside, especially if you are using the MS Word program.

Why then is it that I routinely find letters, proposals and other documents crossing my desk that contains anything but correctly spelled words? It seems there is a general lack of concern about being precise when it comes to written communication skills since the default attitude I am experiencing is generally as long as you get the point across, who cares? Ahh, well now, I do and I imagine that much of my Clientele do as well. Call me old school, but I still believe in first impressions especially if you are a job applicant who has responded to an ad where it clearly requests that one have a strong command of written and verbal communication skills. For example, your resume is your first opportunity to demonstrate to me that you at least got the memo on that particular requirement of the job. Hello! If you were an assistant to so and so, please at least be able to correctly spell your title. I really won’t be able to get past an incorrect reference to the role you played if you yourself don’t respect it.

Had enough fire and brimstone? Okay, just keep in mind that even Santa makes a point of checking his list twice to make sure no one gets overlooked. So should you. In this age of immediacy, double-checking and reviewing may seem tedious and to some degree stressful as we all are on some sort of deadline, but it is necessary. Cross those T’s, dot those I’s and read twice or more before sending. An effective aircraft salesperson that shows attention to detail when it comes to the multitude of documents involved with a transaction will ensure that a Client’s needs are being properly addressed. Don’t just leave it to the inspection crew, the escrow agent or legal counsel to catch discrepancies. Overlook them and the mistakes will bedevil you. After all, the devil is in those details and there is some Satan out there who will be fully prepared to use your mistakes against you.

JETNET

JETNET Creates Powerful, Industry-Changing Market Analysis Tool

JETNET LLC, the world leader in aviation market intelligence, has significantly expanded its unique, aviation-specific customer relationship management tool, JETNET CRM, to include market analysis, market research and prospect management functions. They’ve announced a major new release and branding for the product, designed specifically for aircraft professionals. Improvements include specific aircraft selection and sorting with ownership and sales histories; custom-designed lead generation reports with hundreds of potential buyers; high-probability target list generation; custom notes, action items, and flagged prospects; and easily managed lead/prospect lists and generated reports for importing/merging into scheduled emails. To reflect its new functionality and expanded applications, they’ve branded the new product JETNET Marketplace Manager. Working hand-in-hand with JETNET Evolution Marketplace, the company’s flagship intelligence service, Marketplace Manager accesses a combined database of JETNET’s worldwide data, and a company’s own information.

“When we see a need in the marketplace, we fill it,” said Vincent Esposito, JETNET President. “Our customers love JETNET CRM, and we saw the potential to do more with it for those who buy and sell aircraft. This was the perfect opportunity to develop a software service that fits uniquely within the aviation marketplace, and be customizable by our users themselves.”

JETNET CRM, designed exclusively for the aviation industry, allowed customers to combine all of JETNET’s extensive customer data with their own, to create custom applications that give users the best of both worlds. In the new Marketplace Manager, JETNET has expanded the product to include broader market functions like market analysis, market research, including sold comparables and market surveys, along with prospect management, enabling each client to create a unique view of the aircraft market tailored to meet their needs.

Clients now have the ability to cost-effectively manage prospects for each of their aircraft through an innovative Prospector tool. Users can create six different targeted call lists, accounting for hundreds of likely buyers for each aircraft listed for sale. Custom-designed lead generation reports help clients identify aircraft prospects, understand the marketplace better, and find buyers.

JETNET has addressed security and proprietary data concerns by hosting each subscriber’s application separately, so there’s no risk of competitors having access to your proprietary information. Each customer works from their own completely separate database, at a unique, dedicated website address that combines all of their own information with all of JETNET’s. Marketplace Manager is maintained and hosted by Aero Web Tech, an independent database software firm, to provide physical and contractual separation between individual clients’ databases and proprietary needs.

“We’ll be making revolutionary improvements to Marketplace Manager in the coming year,” said Paul Cardarelli, JETNET Vice President of Sales. “Dealers and brokers can share all this crucial information with their staff regardless of location, through a standard browser interface. You’ll have instant, secure, and worldwide access to the most trusted aviation market research data available.” The product is web-based, so it works equally well on both PC and Mac platforms, as well as on a smartphone or iPad. Marketplace Manager requires a subscription to the JETNET Evolution service.

Among JETNET’s clientele are leading manufacturers, suppliers, and government and advocacy groups for business and commercial aviation worldwide. As of March 2014, JETNET’s database of in-operation aircraft exceeded 100,000 airframes, which includes business jets, business turboprops, commercial airliners (both jets and turboprops), and Helicopters (both turbine and piston). The database includes comprehensive details on aircraft airframes, engines, avionics and cabin amenities, as well as aircraft owners and operators, lessors and lessees, fractional owners and a host of other entities associated with aircraft. Also included are transaction histories on aircraft dating back more than 25 years.

Since 1988, JETNET has delivered the most comprehensive and reliable business aircraft research to its exclusive clientele of aviation professionals worldwide. JETNET is the ultimate source for information and intelligence on the worldwide business, commercial, and helicopter aircraft fleet and marketplace, comprised of some 100,000 airframes. Headquartered in its state-of-the-art facility in Utica, NY, JETNET offers comprehensive user-friendly aircraft data via real-time internet access or regular updates.

 

JETNET

JETNET Releases March 2014 and First Quarter 2014 Pre-Owned Business Jet, Business Turboprop, Helicopter, and Commercial Airliner Market Information

JETNET Business Aviation Market ReportJETNET_March_Market_InfoUTICA, NY – JETNET LLC, the leading provider of corporate aviation information, has released March 2014 and first quarter 2014 results for the pre-owned business jet, business turboprop, helicopter, and commercial airliner markets.

Market Summary
Highlighted in Table A are key worldwide trends across all aircraft market segments, comparing March 2014 to March 2013. Fleet For Sale percentages for business jet and business turboprop market sectors were down in the March comparisons, but increased slightly in the helicopter markets.

Business jets are showing a good start in the first quarter of 2014, with a 3.1% increase in pre-owned sale transactions, and are taking less time to sell (73 days less) than last year, with a 11.6% decrease in average asking price. Business turboprops decreased 15.8% in sale transactions, with a double-digit decrease in average asking price of 29.4%.

Both turbine and piston helicopters saw declines in sale transactions YTD at 9.6% and 2.8%, respectively. Turbine helicopters recorded a double-digit increase in average asking price of 35.2% in the YTD comparisons through March 2013.

Download the full report (PDF)

JETNET

Don’t Bank On It

The following was originally posted by Par Avion Ltd. Re-posted with permission.

The bizav industry has certainly seen its share of troubled loans and losses since the Great Recession and banks portfolios were at one time loaded with bad debt from sour aircraft deals.  To some degree financial institutions that were prolific lenders back in the day are still dealing with non-performing assets and struggling to move them in what remains a somewhat stagnant resale marketplace.  It’s perhaps no surprise that the majority of the distressed jet assets are “classic” aircraft, 20 years or older or relatively new, but less popular models.

What may come as a surprise to some is how differently financial institutions treat a troubled loan and the respective borrower.  Not all things are created equal in aircraft finance land and while the reader may interpret this as a word of warning for the lender, it actually is a word to the wise for the borrower.    Your relationship with the lender on the backend of a deal is as important, if not more so, as it is on the frontend.   While the majority of borrowers work from the premise that their financial situation down the road will improve, what if an unforeseen event changes your fortune or outlook?   What’s that old saying about finding out who your friends are when the going gets tough?

Recently I was involved with an aircraft for which the note had reached maturity.   The owner of the airplane informed the financial institution involved that they were not planning to buy the note out nor “roll it over”.  The owner was in an interesting position to be able to just walk away because the loan was one without recourse and the aircraft was held in a single purpose entity.   One could hardly disagree with this option given that the market value for the airplane was less than what they owed.

The owner further advised the financial institution that a sale of the aircraft, that would make everyone relatively whole, was imminent and requested that the lender work with them in an effort to consummate said transaction.  By work with them the request was for more time to bring the deal to fruition.  Given that the aircraft was well maintained, sheltered and otherwise being cared for, one would think that the lender would embrace this and support their Client’s efforts to achieve a retail sale.   As opposed to having an airplane turned back to them and potentially becoming a devalued asset on their books.   At the very least it would result in a more expeditious sale then if the lender had to start the whole process all over again.

The jet involved while not yet a classic, is a model that has limited appeal and for whom buyers in the best of times are far and few between.  The deal was not without its ups and downs, but what aircraft sale over the last five years hasn’t been challenging?   Ok, that of a G650.  The transaction was not moving at a pace this lender deemed reasonable.   It not only required a bit more nurturing, but as well a bit of lender participation and in the absence of such, started to drag.    While delays and setbacks have been par for the course for purveyors of business aircraft over the last five years, the lender either did not appreciate or understand this.  The lender’s idea of affording the Client time was in the neighborhood of a couple of weeks post maturity date of the loan.   They became totally uncommunicative with the parties to the transaction, moved swiftly to take possession of the asset, canceled the deal and informed the Client they were moving forward with a UCC sale of the plane.   In all fairness, let me say the financial institution was certainly within their right to take this action.   The question though is it the right course of action in all instances?

The UCC requires that disposition of the lender’s collateral be conducted in a “commercially reasonable” manner.    If after giving public notice of the offering and a concentrated effort is made to market it, a qualified buyer is not found then the lender can move to auction the asset.   It seems the definition of “commercially reasonable” and “concentrated effort” are open to interpretation.   How in this particular example, does disrupting the existing marketing effort and the deal on the table better anyone’s position?   The market views an airplane repossessed by a financial institution, regardless of the circumstances surrounding that repossession, as a distressed one.  Preservation of market value of the aircraft should be paramount with an eye towards maximizing the return on investment.   The secondary fallout that occurs as a result of a repossession among a model whose market value is still correcting, is a further facilitation of falling prices and potentially establishing a new benchmark should it sell at a distressed asset price.

The natural reaction by most people upon hearing of a repossession of an asset is to assume that the borrower was a deadbeat and can’t pay their bills.  I’m here to tell you that this is not always the case.  My take away from this experience included:  1. that the bigger the bank/equipment lender/financial institution the less personal the treatment.  2. The loss likely amounts to a rounding error in their world and they are simply following the checklist.   3. It further underscores for me that the smaller lender is likely the more user friendly and certainly more inclined to have a relationship with the borrower.  This is not to suggest that the due diligence process on the front side of the loan is any less stringent.  What you want though is a banker who will listen not just in good times, but as well during the bad.

Think reason prevails when there is a desire to get the aircraft off the books?  Don’t bank on it.