I get asked all of the time what will happen with the aircraft market / aircraft values.

The answer is prices will continue to rise until the manufacturers produce enough aircraft to meet demand or the charter business collapses.

We are simply not producing enough private jets to replace the aging fleet, much less meet demand.

Here's some numbers for popular light and mid-sized jets produced in 2023.

Phenom 100EV/EX ..................... 13
Phenom 300E ............................ 61 (16 went to NetJets)
Praetor 500 ............................... 23 (12 went to FlexJet)
Praetor 600 ............................... 19 (3 went to FlexJet)

Challenger 3500 ......................... 60 (11 went to FlexJet)

Gulfstream G280 ......................... 22

HondaJet ................................... 20

Citation M2 ................................ 29
Citation CJ3+ ............................. 33
Citation CJ4 ............................... 32
Citation XLS ............................... 18
Citation Latitude ......................... 39 (24 went to NetJets)
Citation Longitude ....................... 23 (15 went to NetJets)

Citations produced in 2023 for individuals ......... 135

Number of Citations that are now more then 40 years old ........ 771!

As the fleet of private jets ages out, we're replacing them to the tune of just 392 a year, and remember that is worldwide! Not just the US.

In addition to the above Cirrus added 102 SF50G2's last year, but I think that hurts more than it helps. We have recently added the Cirrus Jet to our list of aircraft we will acquire for clients, the decision was largely made on the fact that it will generate repeat business. Most buyers of that aircraft will be upgrading in a couple of years. That means it actually increases demand for light jets.

How many older jets are retired from service each year?

*Total production of ALL private jets in 2023 was 683, which includes large cabin jets not listed above.

It varies from year to year, obviously, but when I get back to the office, I can give you some rough numbers.

It varies from year to year, obviously, but when I get back to the office, I can give you some rough numbers.

Well more like 15 Challenger 3500’s.

I think that is an important comparison. Is the fleet shrinking? Growing slower than demand?

A big boost in production would be expensive, but if there is long-term demand, it would also be highly profitable. There has to be a reason all of the manufacturers are being cautious and keeping volumes low. They may not be right, but it is odd that they are all in agreement.

This, and it affects the non-jet OEM's as well. To overcome these obstacles the increase in production costs would outpace increased sales revenue. Would also likely affect quality, as the labor pool expertise would be diluted.

That is interesting to hear. Supply chain and labor issues have cleared up in virtually all the businesses I work for and speak to. I can see aircraft manufacturing lagging, but didn't think it would still be a big constraint.

Here's the number of (mostly US) jets that we've lost over the last 6 years.

2023 - 166
2022 - 243
2021 - 258
2020 - 377
2019 - 324
2018 - 386

I say "mostly US" because the system we use doesn't always track airplanes well once they leave the US. So those numbers are likely much larger, maybe even twice what I listed, logic being that as aircraft get older they leave the US and then get scrapped or crashed.

It's interesting to note that as values have gone up the number of aircraft removed from service has declined.

In conclusion, I don't think the current fleet is actually shrinking, relatively new players like Honda, Pilatus and especially Embraer have added a lot of production capacity. However, we certainly aren't meeting demand.

Just one example:

In 2019 we demoed a new Phenom 300E for an Arizona based client, the order price at that time was $9.6M and delivery was about 18 months out. Today lead times are nearly twice that and new 2024 Phenom 300E deliveries are flipping north of $14M!

I was encouraged to see that most of the 2023 deliveries of 300E's did go to owners and not fractionals, it was the opposite.

Apparently we in aviation have the honor of being effected way downstream from everyone else. Precious metals are an issue... Pratt can't get them to build engines.

We have a client that we purchased a 2022 Phenom 300E for 12/22 by May one of the engines was making metal, it took four months for Pratt to get a loaner! Even if Embraer could build more airframes, they wouldn't have engines!

New aircraft production is way down from pre-Covid levels.

Yeah, you just can’t ramp up production. Interesting logistics. Was listening to a talk by one of the Piper execs. He said they preorder their Lyc’s and Pratts over a year in advance, as well as some of the other hard to get items, like windscreens. So they know a year in advance how many planes they are building next year, and that is basically it for production. They are also purposefully under building to maximize efficiency, keep a tight handle on quality, and avoid overproducing when there is an inevitable decrease in demand. They are sold out well into the future with this strategy. Same with Cirrus. They are sold out years in advance, so not really worried about fluctuations in demand.

Yep, Jim Allmon (Blackhawk) told me the same thing, they order engines a year or more in advance and last time Pratt cancelled their order! He said "what the heck??" and they said "we can't build them, so what's the point" he hopes to get half of the units they originally ordered.

It is absolutely hurting Boeing and every supplier that feeds into a big jet right now. Both labor and material. Lead times are huge for just about any material or standard, and something like titanium is still hard thanks to the war and sanctions and leads to collateral problems like the "fake" titanium in the news recently.

There is a lot more activity keeping older jets flying than there was pre COVID.

More people are running past TBO, for example. Planes that might have been scrapped a few years ago are kept flying now since they are more valuable.

Salvage yards are doing huge business selling parts to keep older planes flying and are having trouble finding inventory. I've seen prices for certain parts shoot up. I bought a replacement hydraulic pump for $200 back in 2021 (the vendor had 4 of them), now they are $1500 or more (and that vendor has none now). You can't find cores for starters. No wheels out there, either. And so on.

People are doing avionic upgrades, paint and interiors, etc, on these now more valuable airplanes. They are generally being better kept.

When/if the current boom becomes a bust, there may be a lot of low priced very nice older jets for sale.

Mike C.