Last week I attended the International Aircraft Dealer’s Association (IADA) Spring Meeting in Scottsdale, Arizona. While there, I had the opportunity to hear from some of the top people in our industry on various topics. I will share some of the highlights I picked up on the following topics:
- The General Economy
- Pre-Owned Turbine Aircraft Marketplace
- Global Tariffs
- Bonus Depreciation
The General Economy
The general economy and the stock market have been on a bit of a roller coaster over the last 6 months. The stock market benefitted from a post-election bump in November 2024, stemming from high expectations about the new administration’s pro-business policies. But, due to some uncertainty about trade policies, general market optimism slipped during the second quarter.
The biggest contributor to market uncertainty has been the constantly changing trade policies discussed and implemented by the new administration. Investors have been finding it difficult to plan for the future with such drastic changes to trade policy week after week. In fact, one economist that spoke to us showed a graph reflecting that the U.S. Trade Policy Uncertainty Index is at an all-time high since they started tracking it in 2000.
Pre-Owned Turbine Aircraft Marketplace
2025 started out a bit sluggish as potential buyers tried to predict where pricing was headed. General interest began to pick up in March, but then the stock market fluctuations really put a damper on potential buyer’s plans. Corporate buyers tended to pull back a bit to see how government policies and regulation might affect their bottom line.
The market has begun to “split” as supply of older, higher time aircraft began to increase while supply of newer, current generation aircraft remains limited. Consequently, prices on out of production models have been dropping the last few months while prices on in-production models remained firm and availability remains tight.
Turbo-Props – Generally increasing supply since January with average prices dropping during Q4 of last year and Q1 of this year. With just under 5% of the fleet for sale, supply remains a bit tight
Light Jets – This market category has experienced the most pricing pressure recently. Supply has been climbing since the first of the year, and average pricing has been on a downward trend for the last year. The average aircraft for sale in this category has been on the market for almost a year now and at supply nearing 8% of the fleet, this market is leaning more towards a Buyer’s market than it has since before Covid.
Mid-Sized Jets – Supply of mid-sized jets has been mostly flat for the last 6 months, and average asking prices have been generally trending downward. I’d put the Mid-sized market into more of a balanced market, though again, finding newer, current production models remains challenging. Only 8% of the mid-sized aircraft for sale are newer than 10 years old.
Large Cabin Jets – Inventory levels in this market segment have been fairly flat since Q4 of last year, while averaging prices have been increasing. Only 19% of the aircraft for sale are 10 years old or newer.
Global Tariffs
US Trade policy is changing every day and odds are that it will change as soon as this report goes out. But, there are a few things I can recommend based on what we know now.
If you are considering purchasing an aircraft manufactured outside the United States and currently based outside the United States, hire a good Trade Compliance Attorney to help you navigate the ins and outs. I can make a few recommendations if you need a few names. There is a lot of nuance and misinformation out there right now and the penalties for getting something wrong can be quite steep.
Following are a few strategies for tariff Avoidance:
- Buy an aircraft Manufactured in the U.S.
- Buy an aircraft already registered and based in the U.S.
- Buy an aircraft that meets USMCA manufacturing standards.
- Include an indemnity or right to terminate a transaction in your purchase agreement if future tariffs are imposed.
- Failing all that – If buying an aircraft based overseas that is subject to tariffs and provides the right to accept or reject the aircraft, do the pre-buy outside the U.S. and do not import it stateside until you know you want to move forward with the purchase.
Bonus Depreciation
Last week, The U.S. House Ways & Means Committee released its proposed version of the Upcoming Tax bill. That bill includes a return to 100% bonus depreciation available through 2029. The Bill would allow taxpayers an immediate duction of the cost of the aircraft acquired and placed into service, retroactive to January 20th, 2025.
Unlike the 2017 Tax Cuts & Jobs Act that previously implemented Bonus Depreciation, there is no phase down period this time. But, this bill still needs to be vetted & approved by the House & Senate and finally signed into law by the President. Best guess is that will take several months, meaning it could be signed into law around August timeline.
But, the bill is still subject to change. Our hope is that it doesn’t get revised drastically or watered down in the approval process.
I hope you find this information helpful. If you have any questions or would like some more detailed information on the current value of your aircraft, or any other aircraft you may be considering, please don’t hesitate to reach out.