As we continue looking at what to expect in your aircraft transaction, there are specific points that relate to buyers and sellers separately. (You can read Part One here)
BUYERS
You will not always be able to fly your jet directly after closing.
This is very specific to your personal circumstance, but if you require a registration or tail number change or an operator change, this process can take a few days to complete, during which you cannot fly the jet. If you are buying a jet and leaving it in the country you have purchased it out of and have crew and an operator in place, you can usually fly right out of closing. But if you are, for example, buying a jet out of Germany to place on the UK register which requires a re-registration and a tail number change, this will take a few days for all the paperwork to go through.
See article: Wrapping It Up: The Closing Call
A pre-owned jet’s interior will not look like a brand new jet, and a seller will not make it look like one for you. Some buyers get on board a jet and immediately mark up a number of interior defects they want the seller to fix. However, the seller has no obligation to fix cosmetic items in the cabin; their obligation is to fix items whose non-repair affects the airworthiness of the aircraft. If you cannot live with certain interior defects, factor that cost into your ownership to fix when the jet is yours.
SELLERS
Upcoming maintenance is often discounted in today’s transaction.
Buyers will usually think about how much money they will have to pay in the next 24 months on maintenance for the aircraft they are buying. If your jet is 6 months away from a major 1 million dollar inspection, this will need to be discounted in the price. The rough rule of thumb is if maintenance is due in the next year, a buyer will usually consider it for a discount. This of course varies on a scale. Smaller 6, 12 or 24 month inspections are not included in this because they are minor and considered a part of normal yearly operation. But if you have a Global Express and the 10 year Inspection is coming due next year (the 10 year inspection is the largest on this model), this will definitely be taken into account on the asking price. As of this writing, ADS-B Out is being discounted from prices even though it is not due for 18 – 24 months.
A buyer will not place the same emotional value on your jet as you do.
Owners often have strong emotional attachment and feelings for their jet. They may have had a bespoke interior installed, or a custom colour scheme for the interior or exterior that has a lot of personal value for them. The jet is something they have spent a lot of money and time on, so they may have a stronger love affair with certain aspects of it that an outsider will not share. A buyer will be looking analytically at your jet and rarely will they value the same interior colour scheme or special woodwork you have installed as you do.
The more you know what to expect up front the smoother your transaction will be. We can walk you through each of these points if you have any questions. Our desire is for you to have an enjoyable and successful transaction, and the more information we can provide you up front, the better the experience can be.
Articles are written from real world experience by Colibri Aircraft’s individuals. If you have any questions or comments about the topic of this blog, please feel free to contact us at enquiries@colibriaircraft.com
