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We live in exciting times for aviation. Never have so many new and technologically advanced models been in development. Great for buyers, great for manufacturers. But in the real world, your life will change in the next three to five years. Can you guarantee you know your needs and aviation requirements that far out in time? Few can. Things change…today, many manufacturers are announcing spectacular new models for which they ask for and expect deposits ranging in size from a few thousand dollars to multi-millions, then ask that you wait 2-5 years for delivery. A lot of things happen in 2-5 years…life happens, desires change, aviation needs change and worse, we are all mortal. An airplane that fits specific needs may work when you place the order, but in the 5 years you have to wait for delivery, business may get better or worse, family’s evolve through marriage, kids or divorce making the future deposit schedule daunting.

We are an instant gratification society. When we buy new cars, gadgets or toys, we want them now. Only 10 years ago, over 1/3 of the new cars were ordered, now, less than 5%. We buy what we can drive away today. The need to expedite the purchase of a new aircraft, or the desire to sell a future position can be seen either as a problem or an opportunity. That want for instant gratification can turn early interest in an unknown airplane into a valuable asset. Aircraft positions can be worth a premium in today’s marketplace. Depending on the make, model, position ownership structure and delivery date, the decision to buy a position several years ago can be valuable.

The transaction of buying, selling or even trading of a position is similar in nature to a real delivered aircraft. While no pre-buy inspections are needed, the paperwork, position ownership and associated paper work present their own unique problems. The surest hedge against unexpected roadblocks is to utilize industry specialists who have amassed experience in the intricacies and nuances of the process, and who know the market appetite and marketability of the various future deliveries. While many aircraft brokers dabble in this arena, there are a few who specialize in this facet of aviation marketing. Legal ownership of future positions often can be difficult to determine. Delivered aircraft ownership can be accessed in many places, but buyers seeking a specific make and model have no centralized marketplace and almost without exception, find no assistance from the manufacturers, who understandably want to add to their backlog, not swap buyers.

Speaking of the manufacturers, how do they see it? Publicly, the resale or assignment of purchase agreements are frowned upon and even forbidden in many purchase agreements. Despite contractual limitations, however, most new aircraft are purchased and held in a single asset LLC formed for just that purpose and thus, manufacturers have very little ammunition to stop the sale of a company ( or LLC ) which may contain assets including an aircraft contract and depository account. Privately, the resale at premium of future positions can greatly enhance the popularity and “hype” of a new model, allow and act as a precursor to price increases as backlogs and delivery time create demand. While having lunch with the National Sales Manager of a well known manufacturer, we posed the question if he knew his grocery needs in 15 weeks time. Our analogy was to show, by example, how nearly impossible living in today’s society to plan anything in our busy lives 4 years out. His response is that the best thing for him personally was all of the unpaid salesman promoting and selling his company’s new products, the businessman in him just wanted more control of the process. We have found the various manufacturers to be anywhere from courteous to very helpful. None have been belligerent or difficult; especially when you approach them with all the information they need and bring knowledgeable buyers to the table.

Jet Positions is the leading portal for bringing buyers and sellers of future aircraft positions together, we’re all about great opportunities. After decades of experience and hundreds of transactions, Jet Positions serves as the advocate for both buyer and seller, enabling them to complete a smooth transaction and achieve their business objectives. For more information locating a position or selling a position, please contact us at 317-299-5663 or email us.

4101 Dandy Trail • Indianapolis, IN 46254 • p: 317-299-5663 • f: 317-536-3807

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