In an economy that has ravaged aviation, one stable segment is the insurance industry, but change is coming. “Nobody knows what [the future is] going to look like,” an industry expert told AIN.
UBS Investment Research’s business jet survey released on Tuesday shows that the market index increased to 35 this month, the fourth consecutive move higher, which UBS analyst David Strauss said is “indicative of a much slower pace of deterioration.” The investment researcher said the business jet index is still weighed down heavily by weak pricing and high inventories since it hasn’t yet crossed the 50 mark indicative of incremental improvem
“The pre-owned business jet market isn’t tanking or upside down; it just returned to normalcy,” noted Dennis Rousseau, a 25-year business aviation veteran and president of AircraftPost, an online market valuation service for midsize and large-cabin business jet owners.
Sources for financing of corporate aircraft purchases may be harder to find this year than last, but Toennies von Limburg, director of international sales with Bank of America Corporate Aircraft Finance (Booth No. 394), said there is value to be had in what has turned rapidly from a buyers’ to a sellers’ market.
Directional Capital, an investment firm led by Flight Options chairman and founder Kenn Ricci, private-equity firm Resilience Capital Partners and “key members” of the Flight Options management team, has made an additional investment in fractional provider Flight Options. HIG Capital, which acquired the Cleveland-based company in November 2007, remains a minority investor.
The 24th annual NBAA maintenance management conference was held in New Orleans last week.
A Massachusetts judge has granted a petition for a temporary restraining order preventing JetDirect Aviation Acquisition Company (JDAAC) from completing the purchase of assets of JetDirect Aviation, at least until a preliminary injunction hearing is held tomorrow at 11:30 a.m. EDT.
Directional Capital and Resilience Capital Partners have increased their financial stake in fractional-share operator Flight Options and now own a majority of the company. Members of Flight Options’ management team also participated in the new investment. Directional Capital is headed by Kenn Ricci, chairman of Flight Options and also the company’s founder.
UBS Market Research’s latest snapshot of the business jet market shows continued incremental deterioration in market conditions in February, although at a slower pace than in the November-to-January time frame. The depressed market conditions are being caused by “way too much” pre-owned inventory for sale, falling pricing and tight financing, the firm said.
After a grueling quarter of massive price destruction, a wave of opportunistic buyers has begun to surface and infiltrate the pre-owned jet market. The current economic environment coupled with the public flogging of private jets and their owners has created a sea of discounted jets in all shapes and sizes. There is a growing perception by many that now is the time to buy.