Blog - Page 23 of 28 - Mesinger Jet Sales

NBAA 2011 Wrap-Up

From my perspective, this year’s NBAA Annual Convention was a huge success.  After the last few years of uncertainty and truthfully, some depression about the state of the global economy and our industry, people were enthusiastic and excited to be in Las Vegas and ready to get business done.  Pre-registration numbers exceeded the total registration for all of last year and registration by internationally based business aviation businesses and participants hit a record high.  The convention center halls seemed packed and bustling with activity and the static display appeared to have real buyers ready to talk about buying aircraft.

Our company had a GIV-SP, GV and a Challenger 604 available during the show for private showings at the McCarran Airport and we had several good showings.  We had scheduled meetings with several principles who attended the convention to talk about different sales and acquisition projects including some clients who came to the show from China.  My father and Jeff Lee, Aviation Director for American Express, hosted the Opportunities for Business Aviation in China/Asia panel discussion for the third year in a row.  The first year they had a 100 person room.  The second a 200 person room.  And, this year, they packed the house in a 300 person room for what was definitely one of the hottest and most discussed topics of the convention, the growth of business aviation in Asia.

I’ve been attending NBAA conventions for almost 15 years starting when I was in college thinking of entering our family business.  Every year I am reminded of the magnitude of our industry.  Business aviation is an important part of our U.S. economy providing more than 1,000,000 jobs and one of our most valuable exports, corporate aircraft.  It also supports our ever growing globally connected businesses and allows people and companies to do more than would ever be possible by using commercial airlines alone.  Many of the companies in our industry are small businesses providing individual components or services that collectively help us build these complex aircraft and support their operations.  Additionally, as was evident throughout the week starting with the opening general session and continuing through the NBAA Gala and Corporate Angel Network fundraiser on Tuesday night, the use of business aviation aircraft helps support philanthropic needs and saves lives.  I am proud to be part of such an amazing industry and I look forward to a long bright future for our company and our industry.

Disparity In The Markets & Great Opportunities

August is historically a slow month for corporate aircraft sales.  Buyers and sellers are often vacationing with their families and not focused on aircraft transactions.  The truth is we did not see our normal patterns of activity, or lack thereof this past August.  Large-body, long-range, like-new aircraft markets have seen continued strong demand and low supply.  I have watched a lot of that activity come from the biggest companies around the world who have had pent up demand for aircraft to travel to clients and operations in the farthest corners of the globe.  We have even seen some good activity on some older aircraft models.  Other markets, however, have been slow although there are great values with motivated sellers waiting for activity to pick up.  There is an interesting disparity of sales activity in our markets leaving a lot of great opportunities for five to fifteen year old excellent aircraft (which you can absolutely get financing on) to help companies and individuals fulfill their mission requirements.

Today another broker called to see if we had any activity on a few super mid-size aircraft that we are representing.  He was representing the same aircraft type and both of us lamented that we had had very little activity on these listings over the last few months.  Neither of us could put our finger on a definitive explanation and both of our clients had recently lowered their asking prices and sales expectations.  As our global economy continues to try to find its footing and companies around the world work to grow their business in light of our economic challenges, I have to believe that they will get back to the basics of getting out in front of their clients and in their operations.  To do this effectively many of these companies will need to utilize corporate aircraft and the good news is that there are great aircraft available at the right values to help them do this.  I am excited that Labor Day and summer are behind us (although I will miss the warm weather) which historically means that it is time for most of the world to get back to business.  Call us today to learn what aircraft we are representing that can help you meet your mission.

Fleet Management And Transition Planning

It has been a while, but several clients are starting to not only talk about one off sales and acquisitions, but about long-term fleet management and transition plans.  It is exciting to hear companies thinking in these terms again and these are projects that we are excited to be a part of.  Transition plans are not easy or quick.  They involve long-term commitments and in depth analysis of mission profiles, corporate development plans, budgets, market evaluations and the review of future products and other outside influences.   Over the years we have developed a lot of resources and proprietary tools that we use when developing these kinds of plans for our clients including detailed interactive budgeting models.   We use many of the same resources when working with first time buyers.

This kind of forward long-term thinking about transition plans, and not just transactions, allows for the development of programs that allow companies to strategically plan and budget to effectively meet corporate needs.  From a flight department perspective, this type of planning provides positive exposure at the executive level as aviation growth becomes one of the key vehicles the company uses to facilitate corporate growth.  From the executive level, the commitment to this kind of planning means that a company can better plan for major capital expenditures and most effectively meet their travel needs.  Longer term strategic transition planning also helps facilitate operational planning like commonality of cockpits, training programs, facilities needs and more.  Over the years we have worked with many large companies to develop these kinds of forward thinking strategic plans and then represented our clients in the execution of them.  While much of this kind of planning was put on the back burner over the last few years, it is good news for our whole industry that many large companies are ready to start discussing this kind of planning again.

Challenger 601-3As

The Challenger 601-3A is one of several Challengers in the evolution of a product which was first developed in 1980 as the Challenger 600.  The product line has evolved through the 601-1A, 601-3A, 601-3R, 604 and it is now in its sixth iteration as the Challenger 605.  Bombardier has used the same fuselage for each of these aircraft.  With a production run that has lasted over thirty years, the Challenger 600 series is one of the longest built most successful corporate aircraft ever created.

The Challenger 601-3A in particular has had a long history of safe and successful operation.  There are 133 Challenger 601-3As actively flying worldwide.  Most Challenger 601-3As have also had avionic upgrades that support global travel.  With a range of approximately 3,000 nautical miles with full fuel and full passengers and a large cabin providing an extremely comfortable flying experience all combined with prices under $5,000,000, the Challenger 601-3A represents one of the greatest values in the corporate aircraft market today.  Further, the Challenger 601-3A fleet has many many years and thousands and thousands of hours of continued safe useful life left and they are compliant with current noise and operational regulations.  Other comparable (performance and size) corporate aircraft cost twice as much or more than the Challenger 601-3A.  In 2007, our firm sold eleven Challengers.  Between 2004 and 2008, prices of Challenger 601-3As consistently averaged between $11,000,000 and $13,000,000.  Today, prices are off roughly 60% from their pre-recession peak.

We recently sold a Challenger 601-3A S/N 5037 and we are excited to currently represent two other great Challenger 601-3As.  Each of our seller’s mission profiles have changed which is directing their respective current strategy shifts for their needs for corporate aviation.  Both of our sellers are also very aware of the current market conditions and our recent experience in this market selling a competitive aircraft, and both are ready to receive offers and sell for fair market prices.  The two Challenger 601-3As that we are currently selling and of which are both immediately available are:

Challenger 601-3A, Serial Number 5050: 1989 model, 7,929 hours, 4,263 landings, 2,059/2,105 engine hours TSOH, dual Honeywell NZ2000 FMS with 6.0 software, triple comms, enhanced flight ID for European operations, WSI Weather, RAAS, Triple Laserefs, dual Flight Bags, Aircell flight phone, dual HF radios, Airshow 400, Sirius Satellite radio and many other cabin and avionics upgrades.  This aircraft has a 12 passenger fire blocked interior.  We helped the previous owner buy this aircraft and then a few years later sell it to the current owner.  Now, the current owner’s mission profile has changed and they are making a transition and selling this too.  This aircraft has had all of its 20-year maintenance done and it has great maintenance history and pedigree.  The log books are well organized and in excellent condition.  You can learn more about this aircraft by visiting our website at: https://www.jetsales.com/inventory/Challenger-601-3A-SN-5050.html.  You can also see a video that we produced about this aircraft at: http://www.youtube.com/watch?v=CujP1EM2oEY

Challenger 601-3AER, Serial Number 5078: 1990 model, 5,724 hours, 2,880 landings, GE On-Point Engine maintenance program, Honeywell GTCP 36-150CL APU (on MSP), On SMART PARTS, dual Honeywell NZ2000 FMS with 6.0 software, dual comms, enhanced flight ID for European operations, Triple Laserefs, dual HF Radios, RAAS, XM Weather, Airshow 4000, iPod Video and Audio cabin entertainment interface, Extended range tail tank “ER” providing approximately 200 additional nautical miles of range and a 10 passenger fire blocked interior with beautiful paint and interior.  This aircraft has all of its 20-year maintenance done and it has great maintenance history and pedigree.  The log books are well organized and in excellent condition.  The owner is no longer flying as much and therefore no longer has a need for this aircraft.  You can learn more about this aircraft by visiting our website at: https://www.jetsales.com/inventory/Challenger-601-3A-SN-5078.html.  You can also see a video that we produced about this aircraft at: http://www.youtube.com/watch?v=4aS4wzDx6nk

Please call us today to discuss these great aircraft further.  We look forward to talking to you soon!

A Workhorse That Defines Reliability

We just listed a 1996 model Falcon 900B for sale, Serial Number 156.  The seller has a long history of corporate aircraft ownership and they have used this aircraft extensively for both domestic and International travel, flying almost daily.  Their intense flying schedule means that dispatch reliability is absolutely mission critical and this Falcon 900B is a workhorse that defines reliability and has not failed them in 11 years of ownership.

The owner has engaged Jet Aviation to manage their aircraft.  Jet Aviation is a global leader in the corporate aircraft management business and their oversight means that no detail is left unattended to.  While the owner has a maintenance director who oversees the maintenance and records for this aircraft, most maintenance is performed by Falcon authorized service centers.  The records are exceptionally thorough and well organized.  The aircraft’s cosmetics are also in great condition and the owner regularly updates and refurbishes the paint and interior as needed.  Additionally, this Falcon has been equipped with avionics to support safe global travel with redundant navigational and communications systems that far surpass many of the Falcon 900Bs in the fleet.

The seller recognizes that having higher than average total time impacts the value of this aircraft and has instructed us to price the aircraft very competitively in the market to compensate for that.  With that concession acknowledged, a prospective buyer’s focus should be on the strengths of the offering and the idea that this is a proven workhorse that can continue to operate as successfully for a buyer’s operation as it has for the sellers.  This is a turn-key aircraft that you can put to work to fulfill your flight needs immediately.  Please visit our website at https://www.jetsales.com/inventory/Falcon900B-SN-156.html to learn more about this exceptional aircraft or call us today at +1 303-444-6766.  We look forward to discussing this with you further.

EBACE: Another Industry Success

The European Business Aviation Convention and Exhibition held its annual event in Geneva, Switzerland May 17th through the 19th. EBACE, jointly hosted each year by the European Business Aviation Association (EBAA), the leading association for business aviation in Europe, and the National Business Aviation Association (NBAA), the leading voice for the business aviation industry in the United States, takes shape as a three-day event and features exhibits, an incredible static display of aircraft, education sessions and maintenance & operations sessions (M&Os). It is all held at the magnificent Geneva Palexpo and Geneva International Airport.

This year I was privileged to have been asked for the second year to participate in one of the educational forums. On May 16th, along with many of my fellow aviation professionals from around the world, we presented at the “EBACE International Aircraft Transactions” conference. Like last year the attendance was great as well as the material presented. I leave each year knowing that international transactions are far more complicated than we are used to in our domestic work. In fact, no two transactions are the same as we blend different countries, different cultures and different time zones into the mix.

So now back at my desk in Boulder I can reflect on my successes at this year’s EBACE. I came away feeling terrific on many levels. I saw old and made new friends with international legal and maintenance professionals. I was able to see and be seen, thereby extending our corporate brand beyond our domestic boarders. I was able to attend several informational sessions, broadening my knowledge base about current International business issues to further support our ability to complete these complex transactions for our clients.

EBAA and NBAA are not just associations whose goal is to put on trade shows, but rather to shape business aviation in their markets for each of us who go to work in this industry every day. Regardless of whether you are operating business aircraft or building and supplying goods or services to this industry, we need associations like these to promote the positive value of business aviation in each and every city, state and municipality within their respective boarders. I urge each of you to learn more about these associations and support them with your membership. Once a member, be involved, stay active and when one of these associations asks for its members to reach out to the local and federal politicians and regulators about relevant issues that impact our operational flexibilities, do it. It is vital!

Visit the NBAA website here
Visit the EBAA website here

Part 8: Looking at the Records

This post is the 8th in a continuing series
A Career Change: Learning the Aircraft Brokerage Business part 1, part 2, part 3, part 4, part 5, part6, part 7

I went with Dean Welch, our technical director, to Pontiac, MI to review the log books and records for a 1989 Challenger 601-3A S/N 5050 we are now representing for sale.  This is one of the most crucial steps in the process of signing up a new airplane.  It can’t be overstated how important it can be for a smooth transaction to physically go to the hanger or FBO that is housing an airplane you intend to sell.  You get a first-hand look at how it has been maintained, how the facility it is in is maintained and meet the people who do that work, and it gives you a chance to make sure you that all of the log books and records are accounted for and accurate.  We read every entry in every book, line by line.  As a broker, you want to know any issues an airplane may have or important upgrades and service bulletins it has complied with and be able to relate that story to any potential buyer before they make a trip all the way out to look at those records themselves anyway.      

This was a really great experience for me, and something that I will repeat many times in the future.  It was also a cold trip, filled with freezing rain and ice covered rental cars.  Michigan is a beautiful place with warm people, but man we hit a cold patch.  Another important element of this trip was getting a new headshot while we were having the aircraft we were listing photographed.  I worked in LA for 8 years, but never got a headshot.  Then, I move to Boulder, CO to sell airplanes and I’m on my second one!  I have to admit that when I first made the move and I needed something fast for the website, my wife and I did a little Photoshop.  Here’s a secret.  If you saw my first one, I am not really standing in front of an airplane.  I am in my house against a white wall and my wife, a master photoshoper, worked her magic.  In Pontiac, it was now time for the real deal.  Our regular airplane photographer, Charles Tack, stood out in the snow with me as I stood next to a real airplane and he took a great picture.  His Photoshop work included removing snowflakes, but the background was set.  Thank you, Charles.  And thank you Dean, for taking me on this trip and doing your share of training me.  A plane from 1989 has a lot of records and you taught me how to get through that much data.  That’s all for now, but there’ll certainly be more to come!     

new headshot
old headshot

  

Part 7: Showing an Airplane

This article is the 7th in a continuing series
A Career Change: Learning the Aircraft Brokerage Business part 1, part 2, part 3, part 4, part 5, part 6

It’s been a little while since my last writing about the newness of my job and the challenges and successes of learning a new industry, but lately I have been pulled up off the bench quite a bit; asked to perform in the game and make some plays.  I wasn’t much of an athlete growing up, so often times the bench was my spot.  But in professional settings I have had the fortune to be called up to play in the game with real consequences.  A couple of weeks ago I was told that in a matter of hours I would be on a plane to Los Angeles to show a G550!  It just so happened that everybody else in the company was working on other deals and in different parts of the country, so it was my moment.  I was very familiar with the details of the airplane, I listened to my father and brother tell me what to expect in a showing like this and I packed my bags and got on the plane out to LA.  I knew I was ready and they knew I was ready!  My brother told me he expected 3 people to come look at the plane. As I stood on the ramp in my suit, with the spec and photo packs in my hand, the people I was meeting with pulled right up in their Global Express and all 7 of them came off the plane right towards me.  Not 3.  It felt very cool to be in that moment at that time, performing for the team and succeeding.  The showing went great and I had that notch in my belt telling me I can do this!    

 It reminds me of one of my first jobs in Hollywood.  I was working on “Something’s Gotta Give” with Jack Nicholson, Diane Keaton and Keanu Reeves, as a PA in the post production department.  I’d been working on the film for months, at the bottom of the ladder, getting lunch, picking up dailies in the morning from the lab and putting about 20,000 miles on my car in a year driving around Los Angeles.  Then one day out of the blue they came in to the office and said, Mesinger, we’re sending you to New York to screen the film at a premiere at a Times Square theater.  They were going to get me two first class tickets, one for me and one for the film (about 6 cans of the actual film from our cutting room.  No other copy exited at this point), a hotel room and a per diem.  I had just lived in New York City while I was in college and had left months before this, so I would be getting to return to my old town and friends on a business trip. A big one!  The same goes for my trip to LA for the G550.  My wife and I had just moved from LA before starting our new life in Colorado and I would be returning to my old home, friends and family on a business trip.  A big one!  Life has a funny way of throwing you opportunities at a moment’s notice.  The trick is to be prepared, focused, confident in your abilities and appreciative of the experience.  The bosses wouldn’t send you if they didn’t believe in you.  The job here at J. Mesinger Corporate Jet Sales is filled with new challenges like this every day and I just focus and learn from each of them.  Stay tuned for a report from my next mission; a trip to Detroit I went on last week to review an airplane we are listing.  It includes late departures, freezing rain, log book reviews and new headshots!

Self-Portrait after the showing

Self-Portrait Something's Gotta Give

Photos included are self-portraits captured from these two experiences. Standing in front of the G550 and feet up, by myself, in a New York screening room making sure the movie was ready to go.

Asking Prices

The idea of an asking price is an interesting conversation in our industry.  Some people use them.  Others say “Make Offer”.  Many people believe that if you just say “Make Offer” a prospective buyer will have to call you to ask about the price and you will have a chance to engage them.  We, however, feel strongly that listing an aircraft for sale with an asking price helps a buyer focus on our clients’ aircraft.  They help buyers know that our sellers understand the market and have a generally accurate expectation of where their aircraft should sell.  I believe that having asking prices helps us elicit more phone calls than not having an asking price.  Of course, this only works when the seller really does have a sales price expectation that is aligned with the actual market conditions.  And, in fast moving markets, up like in 2006 and 2007 or down, like in late 2008 and 2009, it is hard to set an official asking price because you don’t want to overprice the aircraft or sell it short of what the market might bear.

Buyers regularly call us and thank us for including asking prices with our listings.  They appreciate that they don’t have to call, and some are looking online well after business hours, to gain a general understanding of the sellers’ expectations and the market for a given aircraft type.  Real buyers, however, do then call and tell us that they have focused on our aircraft because they understand the value proposition and believe it aligned with the market conditions.  Even if you don’t publicly list an asking price, you still need to have an answer to the question about an asking price when a prospective buyer calls.  There is no definitive answer or guidance, but as a general discussion and idea, I think that stating an asking price helps sell airplanes ahead of the competitive listings.

Two Ways To Tell A Story

When we list an aircraft for sale, we read the aircraft records and go see it to most thoroughly understand it and accurately represent it.  We work hard to identify all details and then tell the best story about it possible.  Every aircraft is unique.  Each has different features and pedigree that we must craft into a story to define the value proposition for a buyer and maximize the sales price for our seller.  I regularly use this blog to tell the narrative about an aircraft listing beyond what the factual aircraft specifications alone can define.  We believe that it is critical to tell this story to help an aircraft stand out from the pack.  And, repeatedly, this strategy proves successful. 

Telling the right story to highlight an aircraft doesn’t stop at our office doors, in our marketing, in a blog post or on a phone call.  It continues at every showing opportunity and in every discussion until we cross the finish line at the closing of the sale.  If an aircraft has a uniquely shaped baggage compartment, but in reality it provides the same cubic feet of storage space as a standard one for the given aircraft type, I would want to make sure that a buyer knows that they aren’t loosing baggage space.  I would craft that message into my story.  Why let a buyer get distracted for concerns that don’t really need to exist.  Or, when showing an airplane, weather permitting, pull it out on the ramp.  Aircraft shine best when in the sun.  In a dark hangar, paint can often look drab and dull.  Or, if you are selling an early serial number of a certain make and model, but it has had modifications and upgrades to make it more comparable to later serial numbers, it is important to point that out to prospective buyers who might otherwise be concerned that they would be buying a “lesser than” aircraft if they buy the early serial number.  

The features and benefits are always different, but if you really understand the asset and think about where a buyer might get distracted or miss a valuable feature, you can build the right story to most effectively craft the value proposition.  This won’t necessarily mean that you will sell an aircraft for more than the market will bear, but it will hopefully help a buyer recognize the value of your offering and help sell an aircraft ahead of the competition.

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