Originally published as a blog for AINsight for Aviation International News on 1/8/21
I was thinking the other day about what it would be like to make a soundtrack for the pandemic of 2020. Every one of us probably has that day that it started for them etched in their mind. For me, it was March 14th, 2020. My wife, and business partner, were flying home from Mexico. We actually cut our trip short to get home, not wanting to be stuck away from home. We did not know much that day but rumors, and the initial news was not good. Flying home we decided to let our employees know that at least for the rest of March, everyone should work from home. By the way, everyone is still working from home almost 10 months later. The first song that came to mind was American Pie, by Don McLean1. March 14th was the Day the Music Died for us.
Over the next several weeks the pandemic began to take shape. I remember calling my friends at the title companies as well as my friends that are aviation attorneys. They all reported that they were mostly working to unravel transactions and send back deposits. Our aviation market shut down. The question was for how long? All of us in the aircraft sales business as well as other segments were feeling close to each other and just collectively hoping for the best while reminding each other to hang on. The song that I put here is Frankie Valli, Let’s Hang on2.
Next came the pronouncements in April and May that I am sure you all received as well. “I am never going to fly on a commercial plane again!” This seemed like just idle conversation at the time. People talking about buying planes and in most cases, they were first-time buyers. I think we all sort of half listened to the callers. What was clear was they were all talking about change. The song I picked for this phenomenon was a Bob Dylan song, The Times They Are A-Changin’3.
Well, you will never guess what happened next. As the depth and fear of the pandemic continued and people began to understand that this was not going away so soon, and that the CDC safeguards were our best hope for a pre vaccine solution, the calls that seemed like idle conversation in April and May began to take hold with callers turning into real buyers. The escrow agents began to tell a different story, as did the aviation attorneys. No more time was spent unraveling transactions. Starting in June the conversation turned to people never having been as busy. As I have said many times, when first time buyers come into the world, so much business gets done. Pilots get hired, management companies get new clients, hangars get leased, maintenance and completion companies get filled up beyond capacity. Our industry gets back to work!
Many people asked if this increase in activity would make prices go up? The answer to that question is, no. Two factors are at play here. First and foremost, this frenzy caused by the new buyers, and accelerated by bonus depreciation, was in large part due to the reduced pricing being offered. Some planes that had been on the market for over a year began to sell, in large part because sellers saw this as an opportunity and finally priced their planes correctly. Secondly, the corporate clients have all but retreated from the market for now, thereby balancing demand.
My final song to wrap the year up is, Bobby Hebb’s, Sunny4. It seems there is light at the end of this very dark tunnel. We are all hoping for a healthy 2021. Happy New Year and onward and upward!
I have provided YouTube links to each of the songs so you all have the soundtrack to my year.
1. American Pie, by Don McLean
2. Frankie Valli, Let’s Hang on
3. Bob Dylan, The Times They Are A-Changin’
4. Bobby Hebb, Sunny