Advice for Buying your First Jet

By Jahid Fazal-Karim, Owner and Chairman of the Board, Jetcraft Corporation

 

It goes without saying that owning an aircraft is an expensive proposition – it’s undoubtedly worth it in terms of time saving, comfort, safety and convenience for those that determine that their life/work needs it – but ongoing operating costs for aircraft can be underestimated by first time buyers. The aircraft doesn’t have to be flying to be costing money – hangaring the aircraft, having a crew on standby, maintenance programmes and costs all kick in the moment you become an owner.  So, as simple as it may sound, first and foremost you to need make sure financials work out.

Long gone are the days of 2008 – and they’re probably going to stay gone for a long time – a time when people could buy aircraft speculatively as short term investments that could be resold quickly for profit. The market has normalised again (as much as it can ever be called normal) and an aircraft’s value in 2017 is much more about the convenience and benefits it brings for the owner over anything else. And while the stock markets don’t appear a particularly attractive option at the moment for investors, in all frankness, I wouldn’t say business aircrafts are in any way a viable, alternative investment.

Having your financing with an institution that understands aircraft is another big plus. It is unlike any other asset, so you want your partner to be able to not only understand but talk the same language as the other players in an aircraft transaction. Not using someone well versed in purchasing planes would be a bit like buying a house and using a builder as your agent. Sure, they know houses, but that doesn’t mean they are the best ones to advise how you buy one.

G6000_sn-9758_exterior__ss_-2459_wm-1000x666

 

The next big one, for the truly first time buyer – is to find expertise that you can trust. Our business really is one of the last bastions where one-to-one relationships with the individual you’re buying from is everything. You can buy almost anything on the internet or without meeting a person – but that doesn’t happen with aircraft transactions. And it shouldn’t. No one should be investing anything, let alone millions of dollars, without someone by their side who has spent their lives in this highly technical and complex industry.

So many buyers believe that because, by and large, they have been successful in other walks of life, that they can apply the same principals and methods to an aircraft purchase. It doesn’t really work that way. Although clearly negotiating prices is a fairly common language across all markets.  But I’m talking about the technical aspects, the choices that need to be made – and these are vital if the goal is buying without regret.

 

GL6000_sn-9758_midcbn_ss_-1831-1000x666

It goes without saying that there are a plethora of aircraft choices on the market. One of the things a partner can help you do, is avoiding over or under buying – which is key. An aircraft should be able to meet your short and medium term uses for it. Just buying the biggest and longest range aircraft because you have the means is not always the right option, just as buying an aircraft that you outgrow in two years is the wrong decision.

The decision whether to purchase new or pre-owned is next on the agenda.  Pre-owned anything in most other industries has some negative connotations but that doesn’t apply here. Almost all aircrafts are meticulously looked after by their owners. This is not a five year old Boeing 747 that has done thousands of hours with millions of boots trampling through it – this is more like a live-in art piece. What I would say is that buying a new aircraft brings a tremendous amount of choices into play. The interior – what it will look like, and including selecting who will complete it for you, (as not only the manufacturers finish the interiors in today’s private jet market) are both important decisions.  Not simply because you have to pay for and live with it, but because resale values will be directly linked to the decisions you make at this point. Some clients are fortunate not to have to worry about that hugely, but most do.

I’ve seen some – let’s just call them rather ‘individual’ choices of interiors – that have then stayed on the resale market for not just months, but years.

My final bit of advice, after 20 years in the industry (and I find most clients are rather good at this), don’t ever cease to enjoy the privilege of private aviation. In the midst of our increasingly time-pressed schedules and occasionally hectic lives, it is a rare opportunity that should certainly be savoured.

               

About Jahid Fazal-Karim

Jahid Fazal-Karim is the owner of Jetcraft Corporation, as well as Chairman of the Board. Since joining the company in 2008, he has taken Jetcraft from a primarily US-based organization to an expanding international corporation. Before joining Jetcraft, Jahid served as Senior Vice President of worldwide sales for Bombardier Business Aircraft where he led a team of more than 100 sales staff and achieved record sales and increased market share. Prior to his tenure at Bombardier, he was Vice President of Business Development and Asset Management for Airbus Industries.

 

About Jetcraft

Jetcraft is the leader in international aircraft sales, marketing and ownership strategies, managing and maintaining over 20 regional offices globally.   The company’s unparalleled success over more than 50 years in business aviation has earned it a world-class reputation, along with an exceptional customer base, a wide network of connections and one of the largest inventories within the industry.