Originally published as a blog for AINsight for Aviation International News on 9/1/23
Like most of you, I spend my day on the phone speaking with prospects, buyers, sellers, lenders, and aviation attorneys. Everyone I speak with has a pet peeve to mention or a troublesome event that happened recently. I will say though, that in these conversations, the overall attitude towards the industry and more specifically the market is far better in 2023 than in the proceeding couple of years. Everyone agrees that it is a far less frenzied space and more inviting for all to join in.
So, with all the joy, what is bothering people? Clearly, the idea of finding a timely pre-buy location to keep a transaction moving forward tops the list for many. It is so difficult to put a buyer and seller together, joined in a contract, and then wait up to a month or more to begin an inspection. The delay brings up another concern. During this protracted time, is it okay for the seller to continue to fly their plane? Typically, the idea of a seller not flying once under contract was not a burden to the seller as the time between finishing a contract and going to pre-buy may have only been a week.
Another problem we experience and hear about from others is the vulnerability of transactions getting completed in a timeline that the hard-fought contract was stipulating. Not only is the start time of the pre-buy a constant source of irritation to all sides, but once begun, the completion of the pre-buy always seems to take longer and bring about problematic issues for all sides. Supply chain issues, labor issues, and regulatory issues cause delays that keep all sides guessing. Uncertainty is always difficult.
Pilot training slots are another hot topic of conversation. Longer than usual delays in slot openings makes time into service stretch to the limits of patience. As we approach the fourth quarter of this year, it is incumbent upon all of us to gather up our list of what bothers us and work to mitigate the issues.
We have been successful with our clients in securing slots for pre-buys out into the future along the timeline of our listing and acquisition agreements. This not only gives us a positive message to distinguish our listings and acquisition projects from the pack, but also the ability to get about the project with fewer delays. From a regulatory and tax standpoint, it seems that every area of both has more due diligence and paperwork to accomplish the desired well-planned outcome.
So, as I listen to what bothers you in each conversation, it strikes me that in almost every problem, there is a solution if one acts proactively rather than reactively. This means that each of us, regardless of the segment that we cover, should take some time to dust off our process checklists and update them according to today’s environment. Our clients may feel overwhelmed by the added steps, but I assure you they will lose that feeling as soon as a successful sale or acquisition is completed.