The manufacturer says it is planning to deliver between 125 and 135 jets in 2024. This would be up by 10 or 20 aircraft on 2023.

The company delivered one Phenom 100 and 10 Phenom 300s in the first quarter of 2024. In the same quarter of 2023 it delivered two Phenom 100s and four Phenom 300s.

READ: Embraer Executive Jet deliveries jump 13% in 2023 

In the first three months of 2024 it delivered three Praetor 500s and four Praetor 600s. The company only delivered two Praetor 600s in the same period of 2023.

This is the most aircraft it has delivered in the first quarter for eight years.

Embraer has traditionally delivered a large proportion of aircraft in the fourth quarter. In the first quarter of 2023 it shipped eight business jets, in the second 30 and the third 28 aircraft. In the last three months of the year it delivered 40% of the year’s total with 49 jets. The manufacturer says it is now working on a Production Levelling Plan to have a stable production pace throughout the year.

The manufacturer shipped 115 executive jets in 2023 – up 13 from 102. This consisted of 63 Phenom 300s, 11 Phenom 100s, 20 Praetor 500s and 21 Praetor 600s.

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New and not-so-new technology is enabling a fresh approach to generating leads and closing deals. So, is tech threatening to supersede the old dealmaking skills? We took the temperature of jet sales with three leading industry players.

Active in the 3D virtual world of the metaverse is Jetcraft. In mid-2022, it bought space in three-dimensional social networking platform Decentraland. Within that space, the aircraft sales, transactions and trades specialist built a virtual lounge linking to its virtual hangar and an immersive introduction to Jetcraft for those new to the company or business aviation.

But does it help to sell jets? “Initial feedback is positive, with visitors appreciating this as a first stop to understanding Jetcraft and being able to virtually explore different aircraft models, before investing time in real life viewings,” says Peter Antonenko, president, Jetcraft. “Our expansion into the virtual world reflects the evolution of our customer base, having seen a 20% increase in Jetcraft buyers under 45 in the past five years.”

Generation Z

Younger aircraft owners are often established metaverse and virtual reality users, he tells us. “A growing number of entrepreneurs from tech and finance are entering the world of business aviation and using our tech insight to support their aircraft needs.” Jetcraft says it is keen to stay ahead of its customers, particularly those who belong to Generation Z. “They are increasingly implementing technology into their day-to-day lives and putting more value on their online identities,” says Antonenko. “As these individuals move through the workplace, platforms such as the metaverse will become fundamental to how they conduct business.”

But Jetcraft’s adventures in Decentraland will not replace the personal contact that is so key to closing a deal, he adds. “While our presence in the virtual world serves as a swift and convenient way for customers to interact with Jetcraft, we firmly believe that face-to-face interactions remain integral to business aviation.” Its Decentraland Lounge and virtual reality hangar are designed to complement the company’s existing service, not to replace the in-person connection that clients value, particularly after Covid.

Jetcraft’s virtual sales lounge is evidence of changing buying habits, agrees Wayne Starling, executive director, International Aircraft Dealers Association (IADA). “We are seeing some changes reflected as follows: the showroom that The Jet Business in London has, Jetcraft’s virtual lounge and other dealers integrating new ideas into their business models,” he tells us.

‘Pulling the trigger’

During Covid some buyers transacted purchases without physically viewing the aircraft in person. That has all but stopped, says Starling. While younger buyers use virtual features in their decision-making and buying process, they want to see, touch the metal and smell the leather. “In most cases, they almost always want to see, touch and feel the aircraft before pulling the trigger. The older buyers are beginning to make use of some of the virtual capabilities but not at the pace of the younger buyers,” he says.

Despite experimenting with new sales models, IADA still believes that most dealers/brokers are still traditional when it comes to selling. As AI starts to play a role in all aspects of business, IADA expects it will influence how aircraft transactions are conducted. Change will happen, but it will take time, as most of the aircraft dealers and brokers are old school in the business jet transaction industry, says Starling.

Plus, buyers can have access to too much detail. “The aircraft owners have so much information available via the internet and publications that sometimes it creates more problems/confusion than help. A good aircraft broker must understand and use all the tools available and start preparing for the future.”

But Zoom (and other social networking platforms) are here to stay, according to IADA. Another fan is Jay Mesinger, founder and CEO, Mesinger Jet Sales. “Zoom and Teams are absolutely embedded in the sales process after Covid,” Mesinger tells us. “Sharing your screen is an important way to share information about a proposed business jet transaction.” But technology can never substitute for the traditional sales skills of understanding the buyer’s needs by listening (and then listening some more), says Mesinger. And not being afraid to ask for the sale sometimes gets overlooked.

‘Do less selling’

For Starling, at IADA, one of the fundamental recent changes in sales is not technology but supply. Gone are the days when all you needed to sell a jet was an available aircraft. “Times are changing and brokers must go back to using their selling skills. One thing I stress to brokers is to do less selling and more helping their clients buy what they need and want. We all like to buy versus being sold.” 

So, while new opportunities – like marketing in the metaverse and social media sales leads – are changing the way some buyers, particularly younger ones, acquire jets, fundamental principles still apply.

Back to some final sales advice from Blake in the 1990’s movie Glengarry Glen Ross: “Only one thing matters: Get them to sign on the line, which is dotted.” Was he right all along?

OMW Dashboard

Aircraft for sale

• 657 Light jets for sale/lease – two more than last week. This represents 6.93% of the total fleet. An absorption rate of 4.21 months. 
• 542 Medium jets for sale/lease – one fewer than last week. This represents 6.66% of the total fleet with an absorption rate of 5.07 months. 
• 452 Heavy jets for sale/lease – the same as last week. This represents 6.85% of the total fleet with an absorption rate of 5.13 months. 

Source: Amstat, March 1st 2024

Business jet flights – Week 8, ending February 25th, 2024

Global

Business jet activity was up 2% year-on-year (YOY). Scheduled airline sectors were 7% ahead of last year.

United States  
The 51,480 business jet sectors logged were 3% ahead of the previous week and 3% ahead of 2023.

Europe 
Business jet flights were 2% behind the previous week and level with last year.

Rest of World 
In the Middle East, business jet flights in the past four weeks fell 11% compared with last year. In Week 8 activity was 6% behind Week 8 in 2023.

Source: WINGX, February 29th, 2024.

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The German operator said that the decision was made in response to “high demand” for the acceptance of cryptocurrency.

Siegfried Axtmann, chairman and founder, FAI Aviation Group, said: “FAI is a forward-thinking business and following requests from clients and following our own research, we decided to accept cryptocurrency as an additional payment option.”

Axtmann added that cryptocurrency has progressively gained popularity as a form of payment in business aviation, offering a fast and secure service. Transactions are also not limited to banks’ business hours.

FAI Aviation Group said the decision aims to enable it to expand its customer base, as well as benefit current clients.

“We anticipate our customers will appreciate the choice and that it will help give our business a competitive edge,” said Axtmann.

FAI Aviation Group added that it anticipates record sales for 2022, expecting group revenues of around €120m ($126.8m) and a growth forecast at 8-10% per annum over the next five years.

The European operator has one of Germany´s largest private fleets of Bombardier business jets. The fleet includes five Global Express, one Challenger 850, six Challenger 604s and seven Learjet 60s.

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The company has offices and sales representatives in Atlanta, Dayton, Chicago, Knoxville, Las Vegas, Lincoln, Neb. and London. It is led by founder and President Mark Rogers.

Rogers said, “Buying and selling aircraft should be turbulence-free. Today, we provide a complete range of aircraft sales and acquisition services, meeting the needs of individuals and companies across the U.S. and in Europe. We are experts in high-performance piston and light turbine aircraft.”

Rogers added that Lone Mountain also welcomes being becoming part of IADA’s online listing marketplace, AircraftExchange. As a Cirrus pre-owned sales partner since 2008, Lone Mountain is the world’s largest reseller of Cirrus Aircraft and has expanded into several other popular aircraft including Embraer, Pilatus, Citation, TBM and Piper Meridian.

“As the only organisation dedicated to promoting transparency and high -level ethics in international aircraft transactions, the IADA Board of Directors is gratified to be able to welcome high volume aircraft dealer Lone Mountain Aircraft as an accredited member,” said IADA Executive Director Wayne Starling. “Mark and the Lone Mountain team will be a positive addition to our organisation.”

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NARA board member, Sabrina Prewitt, Senior Vice President at Jack Prewitt & Associates, coordinated with NBAA to create the extraordinary NARA Static Display for the second year and stated, “NBAA has been very supportive and we have worked collaboratively to make all this come together again this year in Orlando. We are excited about our record-setting display area that is nearly twice as large as we hosted in 2014 and will showcase 33 or more NARA Broker/Dealer Member aircraft. Our expanded NARA campus will allow us to welcome aircraft buyers and sellers into one place where they can meet with our Certified Brokers and Dealers and tour the aircraft. Visitors will also learn more about our association and visit with many of our NARA Products and Services members, and enjoy a Barbeque lunch on Tuesday and Wednesday as well,” added Ms. Prewitt.

“This NARA Static site will feature more than thirty business aircraft, representing 30% of the entire inventory of aircraft displayed at NBAA this year, and eclipsing a variety and supply offered by any other source, including the OEMs,” commented Johnny Foster, Chairman of NARA, President, and CEO of OGARA JETS. “Our chalet will provide a convenient and comfortable location for aircraft buyers and sellers to contemplate their next aircraft transaction. I am very proud of our exceptional relationship with NBAA and appreciate Sabrina’s hard work and determination to create such a large NARA presence at this year’s NBAA show. Our chalet location will also be the perfect setting for our Press Conference on Tuesday at 1:00 PM where we will feature several exciting announcements,” added Foster.

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“2015 is shaping up to be an interesting year,” says Chris Lennon, head of IBA’s business aviation and private jet department. “With the price of oil fluctuating to as low as $65 per barrel, there is a growing demand for corporate aircraft, especially within Africa, the Middle East and Asia. Add to this the apparent resurgence of the Corporate Aircraft Market within Europe, the outlook for 2015 is positive in many regions.”

“However, challenges remain. Chinese austerity measures mean corporate jet owners and operators still face restrictions. But this also brings about greater ambition, with Chinese operators intending to expand their services into Europe or invest in existing operators,” Lennon adds. “In the Eastern Europe, with economic sanctions and the weakening of the Rouble, oligarchs and corporations are diverting their attention elsewhere.”

IBA’s full ratings guide includes pricing and availability information for 65 business jet models as well as remarks for each aircraft. The light/medium and large/long-range segment included more ‘strong contenders’ than the other categories – both included four each – with IBA noting Boeing and Embraer’s strong brand image and the innovative nature of the the Cessna Citation Latitude.

The data reflects a drop of around 20 per cent for Cessna Citation Mustang values with pre-owned prices marked at $1.43 million. Cessna’s Citation CJ2 has also dropped from $2.3 million to $2.06 million. Elsewhere, the upcoming HondaJet is described as “a likeable and innovative little jet.”

Looking at the the large jet segment, the Gulfstream G550, which is frequently noted for its large inventory, is priced between $25.3 and $55 million with 31 aircraft on the market compared to 13 units two years ago.

“Have we seen improved market values on early examples?” asks Jonathan McDonald, senior analyst for IBA. “Based upon the oldest Global Express aircraft coming down from $16 million in 2013 to $14.1 million in 2015, or G550s coming down from $27 million to $25.3 million, the answer has to be an emphatic no.”

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The company have 22 aircraft for sale, about half of the number that is typically available from the JetBrokers team.

Tom Crowell Jr, president of JetBrokers, said: “Sales over recent months have been very encouraging, but it does create further challenges in finding other sale opportunities to replace those that have sold. We have numerous discussions underway with prospective sellers but, understandably, it’s not unusual for the decision process to take weeks or months. We have a few other deals pending, so I’m hopeful that February will continue to be equally encouraging.”

JetBrokers recently changed their loga and consolidated the JetBrokers Europe franchise into their operations.

“There has been a positive response to these changes and it’s good to have a single identity for people to relate to, wherever they are in the world,” added Crowell.

Tim Barber, regional managing director of JetBrokers, said: “This is by far the best start to a year that we have seen since we launched JetBrokers Europe at the end of 2009. With the single identity of JetBrokers now established, our ability to support owners and buyers across the globe is undoubtedly enhanced.

“We’ve been used to having a combined inventory in excess of 40, so it is a little odd to see it at its current level, but that will hopefully offer further reassurance to our prospective clients that they will have even more of our sizeable resources at their disposal.”

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When you look at the Middle East from this perspective, its business jet fleet, which represents less than 3 per cent of the world’s total, suddenly looks rather underwhelming.

According to Jetnet, a provider of business aircraft market research, there are 575 business jets based in the Middle East. Bombardier expects 380 more new deliveries by 2023, where as North America’s fleet is expected to swell to 12,430 with 4,885 new deliveries in the same period.

“The Middle East is still an emerging market,” says Wassim Saheb, a sales director for Bombardier. “The political situation has been horrible for the past five years.”

Beyond geopolitical problems, a reason for this comparatively muted growth could be explained by the fact that the Middle East was the only region this year where the number of billionaires actually dropped – from 84 to 66 – despite a global increase of 15 per cent, according to Bombardier.

The bigger, the better

The perception of Middle Eastern business aviation is that it is very much driven by ultra-long-range aircraft and lavishly-configured bizliners – and there is some truth in this. Heavy jets account for over 70 per cent of the Middle East fleet, and large jets account for 24 per cent of the deliveries predicted by Bombardier over the next 10 years.

Looking at Jetnet’s data in more detail, the combined Airbus and Boeing fleet makes up 24 per cent of the region’s total fleet. Whereas the Cessna Citation Excel is the best-selling business jet series worldwide, the most popular aircraft in the Middle East is the larger Bombardier Challenger 605, closely following by the Boeing BBJ1.

MUST-READ: Flying by BBJ: From pizza ovens to putting greens

There is also a perception that aircraft buyers in the Middle East are driven by more superficial motivations, with corporate jets used as status symbols rather than business tools.

“A lot of the Middle Eastern buyers want the latest, fadiest thing on the market,” says Brendan Lodge, business development director at JetBrokers. “Cash buyers are more dominant.”

An ACJ319 (A6-CJE) operated by Emirates.

However, as the market matures, buyers are becoming savvier. Dassault sees huge potential for its Falcon jets in the Middle East, where the regions accounts for 20 per cent of Falcon 5X sales globally.

“I recently spoke to a Saudi businessman who was trying to calculate the life cycle costs of an aircraft,” says Olivier Villa, senior vice president, civil aircraft at Dassault. “He looked at the 7X, because he had 7X experience. But he asked what he really needed, which was range, so he is now considering buying the 2000LX until the 5X is available.”

With a higher demand for new aircraft, the pre-owned aircraft market has suffered. Aircraft in the Middle East spend an average of 582 days on the market, which is considerably more than the global average of 391 days last year.

ACJ and BBJs are spending well in excess of one year on the market,” says Scott Plumb, senior vice president for sales at Jetcraft. “Buyers are having to discount these aircraft to below their expectations to get them moving.”

ALSO READ: Airbus continues corporate jet battle with Boeing

It is not only bizliner sales that are dragging. Globally, the Gulfstream G550 inventory almost doubled in the first half of the year and it continues to cause headaches for aircraft brokers.

“One of the toughest markets is the G550, there were seven for sale in December 2014 and there are now 35,” says Thierry Boutsen, president of Boutsen Aviation. However, Steve Varsano, founder of The Jet Business in London, says the number of G550s for sale is still “tiny” and claims “the aircraft has held its value tremendously well.”

Brokers have also struggled to shift Bombardier jets as quickly in the Middle East – as well as other regions – where more than 14 per cent of the Global 5000 fleet is listed for sale, according to Plumb.

ALSO READ: Gulfstream G550 inventory almost doubles

“Roughly, two Global XRS aircraft are selling a month; unless you’re pricing to be one of those two, you’re not going to sell,” says Plumb.

Cultural differences

Some people have speculated that the reason behind the slow sales process in the Middle East could be cultural rather than economic, with Bombardier’s Saheb claiming Middle Eastern aircraft owners are “never happy with the trade-in price” offered to them.

“Sellers in the Middle East prefer a ‘make offer’ rather than putting a price on their aircraft,” says Christopher Zarnik, president of Corporate Concepts. “It means it’s going to stay on the market a lot longer.”

Some of the custom interiors, which are more common in the Middle East than other regions, also have a negative effect on an aircraft’s potential for resale, according to brokers. Lodge adds: “Owners spend a fortune on an interior that no one is prepared to pay for.”

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Although Q3 remained flat against Q2 with 2.7 per cent of the fleet transacted, 7.8per cent of the business jet fleet transacted during the first nine months of the year.

Heavy jets led the charge, with a total of 2.3 per cent of the fleet turning over.

Average asking prices for heavy jets have steadily increased since 2012, reaching a $15.4 million peak in April, but prices have since calmed down to $14.8 million.

ALSO READ: 10 reasons not to buy a private jet

In the medium-size jet market, average prices have dropped 5.3 per cent over the last 12 months, but the light jet market – which has been one of the worst performing sectors – saw prices rise by 2.5 per cent since July.

As well as a healthy number of pre-owned transactions, AMSTAT also says it is seeing the lowest percentage of business jets for sale on the open market since April 2008, with 11.2 per cent currently available.

“The business jet transaction activity is clearly leading today’s resale market recovery” said Andrew Young, general manager of AMSTAT.

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The aircraft manufacturer launched the aircraft, alongside the $43.5 million Gulfstream G500, at a special ceremony in Savannah, Georgia a week before the annual business aviation convention.

During the launch ceremony, the G500 taxied out under its own power, but the larger G600 has only materialised as a mock-up so far.

ALSO READ: How social media reacted to the Gulfstream G500 and G600

At its NBAA press conference, Larry Flynn, president of Gulfstream, joked that a number of people asked how they had managed to roll out the G500 without power, as it was so quiet.

http://www.youtube.com/watch?v=dpvDCzwD9fI

Aircraft brokers weigh in

Gulfstream has scheduled G500 deliveries for 2018, with the G600 following in 2019. The company insists that the G500 and G600 are additions to the Gulfstream business jet family, rather than replacements for the G450 and G550.

Chad Anderson, president of Jetcraft, told Corporate Jet Investor that Gulfstream has instructed aircraft brokers that the company will let the market decide when to eventually phase out its older models. However, another US aircraft broker said he suspected Gulfstream may speed up certification for both aircraft, should G450 and G550 sales begin to stall.

“I think it’s going to be a wonderful product,” Anderson said of the G600. “For existing Gulfstream owners looking to upgrade, it’s a no brainer.”

But Anderson said Bombardier – which represents the fiercest competition with its Global business jet family – may well have breathed a sigh of relief when it saw the aircraft’s specifications.

ALSO READ: Gulfstream vs Global: 10-year deliveries

“Globals are bigger, they cost less [the list price of a Global 5000 is $49 million] and you can get them today,” said the other US broker, who suggested that an aircraft buyer would be better off buying a cheaper – and arguably, more capable – Global jet than waiting for the G600.

Inside the G600

Although the G600 is smaller than the G650, Scott Neal, senior vice president worldwide sales & marketing, says  the aircraft will provide “G650 style comfort,” with large, oval windows and the potential for four living areas (the slightly smaller G500 can host up to three living areas).

Would you like a home theater in your Gulfstream G600? Not a problem! #NBAA14

A photo posted by Paul Thompson (@flyingphotog) on Oct 10, 2014 at 1:29pm PDT

For the G600 mock-up, Gulfstream chose MSB Design in Quebec, Canada, to provide a mock-up of an electric Hi-Lo table and Crystal Carbon and Flatwear (CCF) inserts, designed for storing expensive crockery safely.

Shannon Gill, director, business development at MSB Design, said CCF inserts can cost $700 to $3,000 per piece or from $7,500 up to $80,000 for a full galley.

“The way I look at it is that you’re not spending money on the insert, you’re spending money to protect some very valuable items,” said Gill.

Side-stick replaces the yoke

One of the more controversial features of the G600 is the side-stick, replacing the more traditional yoke in the cockpit.

“We think the side-stick is a significant advancement in safety,” said Flynn. “We are the first in the industry to do it and we are committed to it going forward.”

During the show, Éric Trappier, CEO of Dassault Aviation, joked that Gulfstream had followed its lead.

“We always have great satisfaction when we have placed a new path for the rest of the industry to follow,” he said. “And we are pleased to see that our friends in Savannah have finally decided to move towards side-sticks.”

Although Gulfstream is confident about the side-stick, Flynn said the company will wait for the market’s response, before deciding whether to make it available on other Gulfstream models as a retrofit option.

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