UBS Investment Research‘s business jet update, released April 7, implies that the high number of used business jets for sale might be at or near the bottom.
According to UBS researcher David Strauss, new listings of used business jets slowed to a 1% month-over-month increase in March, although they are still 63% higher than at the same time in 2008. Even though 18% of the in-service business jet fleet is up for sale, “We think a slower growth rate over the past few months suggests inventories may be beginning to stabilize,” Strauss wrote.
As a result of the increased inventory, UBS estimates that the average asking prices for relatively low-time business aircraft have fallen by a significant 30% to 35%. “While our survey suggests some incremental interest at these levels,” UBS said, “we think record high used available inventories will continue to overhang orders, pressure existing backlogs and force further production cuts out of the manufacturers.”
In other words, if you need a business jet now might be the time to buy.