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Prices of Large Business Jets Manage to Rise

May 14, 2018

Despite the lack of improvement in the net pricing of commercial jets, the business jet sector is performing better with new prices registering an increase as manufacturers become more disciplined in their pricing – and production.

At the peak of production in the mid 2000s, the prices of new aircraft increased year on year and such was the demand, that used prices for nearly new aircraft were frequently above the original purchase price. Even after a slump from 2009 onwards, during period 2015-2016 the large dedicated business jet manufacturers – Bombardier, Gulfstream Dassault – were experiencing a slowdown in production. This was due to limited demand from previously expanding countries such as Russia, Brazil and China. The reduced emphasis on ordering new aircraft saw manufacturers engage in discounting to ensure production levels were maintained. Also aircraft that had been previously ordered and deposits paid may have been cancelled allowing the manufacturer to sell the delivery slot at a discount. This fall in new net pricing affected the used market and values fell not by some ten percent but by nearly 40-50 percent for some aircraft. Recently there has been a measure of improvement in terms of used pricing but a return to previous levels has not been possible.

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