Dealer Association Predicts Rising BizJet Prices, Demand

The International Aircraft Dealers Association (IADA) predicts that used turbine business aircraft prices and demand will continue to rise, solidifying the market position that has been building through 2021.

The association’s [third quarter 2021 report|https://aircraftexchange.com/market-report] depicts a landscape where low used-aircraft inventories and a backlog in orders at OEMs combine to drive a 20 to 30 percent increase in sales prices over recent months.

“Clearly, the market for used business aircraft is at an unusual place, with much higher prices and dearth of inventory in the most modern used business aircraft markets,” said IADA executive director Wayne Starling. “The third quarter responses from our membership predict the next six months will continue to have increased pricing and demand for all sectors of the market, while inventory deficiencies will continue to drive higher prices.”

In a briefing with FLYING, Starling spoke specifically of the inventory decline that started near the end of the second quarter of 2020, with “real impact” hitting in Q4 and Q1 of 2021. “The lack of new inventory from OEMs drives it,” he said. And a new type of buyer is part of the equation.

Trade-ins to a new model in the past sent a used aircraft onto the market—but now, a lot of new users of private aviation are creating a different dynamic. “There’s a massive influx of first-time buyers,” said Starling. Up to 40 percent of purchases, in fact, represent these transactions—and “they’re not trading in anything.”

IADA—founded 25 years ago—created its accreditation program partially in response to the needs of new buyers. “They don’t know the process,” said Starling, and thus could be taken advantage of by unscrupulous aircraft brokers.

“The report is a product of trusted opinions backed by hard sales data,” said IADA in a release. “It incorporates quantitative sales data from AircraftExchange.com and qualitative survey data from IADA Accredited Dealers.

IADA markets are spread across the globe, with:

“Year over year, third quarter used aircraft dealer activity reflects a continuing heated market with 182 aircraft agreements, compared to 110 in the third quarter of 2020,” according to IADA. “There were only seven transactions with lowered prices in the third quarter of 2021, while there were 83 in the same period in 2020.”

IADA dealers reported:

For the next six months, IADA projects that demand and prices will continue to rise, based on surveys with its dealer network—which includes 48 accredited dealers, certified brokers, seven of the major turbine aircraft OEMs, and more than 63 of the industry’s leading products and services providers.

This prediction stretches across the market segments, including turboprop, light jet, midsize, large, and ultra-long-range jets.