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| Comfort without Commitment |
Expert Advice
Michelle Seaton
07/01/2004
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The mysteries and minutia of the private aircraft market are formidable. Those
of us actively pursuing ownership, a jet card membership or even a charter may
want to seek out the guidance of experts in the field. These come in three
stripes: brokers, dealers and consultants. Each has strengths and weaknesses,
but in general, these professionals can often help us find the aviation option
that balances our financial and travel needs. “Get professional advice,” urges
David Wyndham, a partner in the aviation consulting firm Conklin and de Decker.
“This could be several million dollars you’ll be spending. You need to get
educated before you buy.”
 Aircraft brokers bring together buyers and sellers,
much like real estate or securities brokers. They help both novice and
experienced buyers analyze the costs of ownership and decide what type of
aircraft best suits their needs in terms of size, speed and make. If we need to
sell our current aircraft before making a new purchase, a broker can help us
find a buyer—a process that can take some time. This is the primary advantage a
broker offers prospective aircraft owners: detailed market data on who is
selling what to whom and at what price. Brokers also know how fluctuations in
the selling price of one model will affect prices of other aircraft.
Brokers
act as agents, while dealers act as principals—in other words, they actually
purchase the aircraft themselves. Kevin Jordan of Business Jet Services in
Dallas, which buys, sells and manages aircraft for owners, explains, “A broker
will give you a listing for your plane. A dealer will buy it from you right now,
so you can get out of it when you want to. You don’t have to pay expenses on it
for two years while you wait for a buyer to come along.” However, a dealer will
probably offer a price that is less than the market will bear. If he agrees to
purchase the plane for $3.5 million, it is probably because he can sell it for
$3.9 million.
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