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Learn to Fly Private
We're so back.
Sorry for the delay in sending, I have spent some quality time this summer with my wife, who is a middle school special education teacher and my 2.5 year old daughter. I usually write this after she goes to bed, but summer means later nights and no one wants to read my 3 am musings on private aviation.
But, schools back in session which means your favorite guilty pleasure, the private jet newsletter, is back for the fall. I've been trying to curate some ideas of what to write about, because I also had some writers block. If you've got an idea of something you would like to hear about, reply to this email and let me know.
Do me a favor... there are over 2500 people that subscribe to this newsletter, which is a huge honor. I want to continue to get the good word out about private aviation, so forward this to someone if you like reading it.
Now let's dig in...
It's a Private Jet summer...
Any time of year is a good year to fly private, but the summer time is when you load up the spouse, the kids, the dogs, and maybe the in-laws if you're feeling especially generous this year, and head to a vacation destination. This usually pushes charters and Part 91K (aka, fractional ownership, aka NetJets and Flexjet) flights ahead of where they traditionally pace. This summer has been the same, according to the latest market report from Wing-X.
Part 135 and Part 91K are up 2% YoY, while the overall business aviation flights are down 1% in the same time period.
What does this tell us?
Corporates are tightening their belt when it comes to private travel on their corporate fleets, likely more of an indication of easing off verses last year and returning to more "regular" levels seen pre-pandemic (we're still up 29% in flight activity vs. 5 years ago. That's why your charters and jet cards are more expensive these days...)
On the buying front, my friends who sell private jets normally take the month of July off, with many buyers opting for vacation in Cabo over shopping for their next purchase. Anecdotally, this hasn't been the case this year. After what was a warmer H1 in 2024 vs 2023, the expectation was to have the traditional July lull before we ramp up into "tax buying season" aka, Q3 and Q4. Many in the transaction market (including us in aviation finance), have seen a large increase in activity that was frankly, unexpected.
To give you an idea of where we're pacing so far, here's a market report from the International Aircraft Dealer's Association.
IADA Dealer Report Closed Deals by Quarter
Part of this is due to inventory levels rising, and therefore more transactions being taken at "market price." Here's a quick breakdown of what's for sale in the jet market from the Leviate Q2 Market Update.
Very Light/Light Jets: 681 (7.2% of fleet)
Mid-Size: 279 (8.7%)
Super Mid-Size: 155 (5.8%)
Long/Ultra Long Range: 330 (7.3%)
Compare this with less than 5% of the active fleet for sale, and inventory levels are coming back to a more market-normal rate. This is why you might be able to get a good deal on a jet.
Bonus content: check out what Ogarajet CEO Johnny Foster says about the current market in my podcast, Flight Path. It's geared towards the business aviation community, but you might find an insight.
So why the increase in market activity?
I think that there is a pent up demand from people who chose not to upgrade during the buying frenzy of 2021-2023. First-time jet buyers ate up inventory in every category, especially focused on the older vintage (10+ years old) and those with 1-10 year old jets decided to hold on to them instead of paying a premium for something a little larger or a little faster. Those buyers are starting to come back, and decided that now is the time for their upgrade or trade-in, which is putting their old aircraft on the market and thus increasing turnover. Good news for those of us that work in the business!
There's also something to be said about an election year. The uncertainty in the market usually just causes delays in purchasing, and who is in the white house doesn't necessarily change buying behavior. That said, when the then Biden Administration called out private jets multiple times in a budget update, you wonder if that anecdote may be a little different. When the polls swing towards a more jet-friendly administration, activity seems to pick up.
Trying Something Out
One of the crazy things about private aircraft sales is many happen via a broker network and never hit the public market. Often sold in Whatsapp groups, slack groups, or email threads, and never seeing a public marketplace like aircraftforsale.com or avbuyer.com.
Well, here's your chance. Your first look at a pre-market airplane! I'm going to start curating some of these from my network of brokers, dealers, and owners that are wanting to sell their aircraft.
This 2021 Piper M600 SLS has 500 hours of total time, so its just getting broken in. The SLS has the "HALO technology" which I lovingly refer to as the "oh shit" button, which leverages the Garmin Autoland technology to safely land if the pilot becomes unable to operate the aircraft. If you haven't seen it, watch this video. Autoland won a ton of awards, including the FLYING Magazine Editors Choice Award in 2021.
This beautiful bird is offered at $3.15m, and would be great for someone who flies themselves or with a professional pilot. Especially popular in Texas, Florida, Southeast, Northeast, and California because of the range that it offers.
$332,000 annual cost (reduce this if you fly with a contract pilot)
$23,000/month payment at 7.25% interest, 20% down, and 15 year amortization
Could you charter it? Probably. But the spread you would get probably wouldn't be worth the wear and tear you put on the airplane. Better off finding a couple friends to share it with so that you can spread the fixed costs around.
Alright, that's all for today. Again, give me your great ideas and let me know if you like the off-market thing. I'll keep doing it if you like it.