Selling a private jet is unlike any other type of vehicle sale. Several factors make the process more complex, including the high value of these assets and the need to ensure the aircraft is safe to operate. Consequently, it is critical that owners and their representatives work methodically to prepare the aircraft for sale, promote it and deliver it to the buyer after closing.
Private jet sales conducted this way move through 10 distinct phases, as described below. This helps ensure that the process moves expeditiously and predictably and that you, as the seller, get maximum value from the transaction.
Phase 1: Determining Private Aircraft Value
Even if they are the same model, no two aircraft are identical. How a private jet has been equipped, used and maintained makes it unique. Consequently, determining the value of the aircraft without the assistance of an experienced broker can be challenging.
The first thing to look at is airframe hours and total landing cycles compared to current averages. This gives you a reliable baseline. From there, participation in engine maintenance programs directly enhances marketability. If your aircraft is not enrolled in this type of program and your price does not account for that fact, potential buyers will likely ask for a significant discount.
Other major valuation factors include:
- Aircraft Pedigree and Ownership History
- Avionics and Equipment, Next-Gen Compliance
- Paint and Interior Age and Condition
- Maintenance Status – Upcoming Expensive Inspections or Events
- Damage History (If Any)
- Complete Records and Documentation
Phase 2: Preparing a Private Jet for Sale
As with any sale, first impressions are important when selling a private aircraft. Seemingly minor issues can quickly end a possible sale, so you want to work to resolve issues that can be reasonably addressed before listing the aircraft.
To that end, a preliminary inspection definitely pays off. Having your mechanic do a deep dive lets you find and address minor faults before a buyer does. This preventive step avoids unexpected surprises and higher labor rates later at an unfamiliar repair facility.
Investing in cosmetic detailing can also boost your prospects of attracting more buyers. You should consider having a team clean and polish surfaces inside and out. That includes touching up paint, cleaning the carpets and reconditioning the interior cabin leather. You should also remove personalized items and customizations as much as possible to present a clean visual aesthetic.
Once you have prepared the aircraft for sale, your broker should hire an aviation photographer to capture high-resolution images and possibly create a virtual 3-D walkthrough.
Phase 3: Gathering and Organizing Technical Records
In this business, paperwork is as valuable as the physical airframe. Immaculate maintenance logbooks can support a significantly higher market value for a business jet. Gaps in recordkeeping can be catastrophic, so you should address them early in the sales process.
To make the buyer’s due diligence quick and efficient, you should have available a comprehensive set of historical maintenance records.
This should include items such as:
- Aircraft Specification Sheet
- Maintenance Logbooks
- Computerized Maintenance Tracking & Due List Reports
- Flight & Avionics Manuals
- Airworthiness Certificate
- Registration Certificate
- Weight and Balance Data
- Equipment List and STCs (Supplemental Type Certificates)
- AD and SB Compliance Listings
Your broker should become familiar with these records and documentation. These records and documents should be ready for presentation to prospective buyers, by someone who is familiar with them.
Phase 4: Establishing an Asking Price and Market Strategy
Setting your asking price is a high-stakes decision. One common mistake is setting a high price to “test the market.” This strategy can be detrimental to the sales process, as it might later require making price cuts that damage the market perception of your aircraft.
Establishing the optimal asking price requires a careful analysis of inventory levels, current market dynamics and other factors. With that information in hand, you can decide if you want to price your private jet aggressively to encourage a rapid sale or more competitively to maximize yield.
Phase 5: Conducting Multi-Channel Marketing
Reaching qualified buyers requires an effective marketing campaign, particularly if you are attempting to reach a global audience. However, you must choose between public exposure and off-market transactions.
Some sellers prefer a confidential off-market sale, but a public launch offers maximum exposure. Whichever approach you choose, you should work with your broker to list the aircraft on all the appropriate portals and platforms from the start. This maximizes the chances that you will generate interest from multiple buyers, which improves your negotiating power.
Phase 6: Assessing Inquiries and Vetting Private Jet Buyers
High-value transactions inevitably attract market noise, making rigorous vetting essential. People wanting to engage with you simply to get a feel for what is available on the market (so-called tire-kickers) can consume an enormous amount of time and effort.
Vetting prospects lets you stay focused on quality ready to act buyers and prevents frustrating false starts. Your broker can help you identify legitimate prospects and shelve others. They do this, in part, by verifying financial capability upfront. This may involve requesting details of prior aircraft ownership experience. Do they currently own an aircraft that they may have to sell before the next purchase? Actions like evaluating a prospective buyer’s operational infrastructure and assessing flight crew availability can also help you separate serious buyers from window shoppers.
Phase 7: Negotiating and Structuring the Aircraft Sales Transaction
With a serious buyer identified, the next step in the private jet sales process is formal negotiations. This begins with a Letter of Intent. This initial document defines crucial high level details of the transaction—purchase price, deposit, initial visual inspection and preliminary logbook review, delivery conditions, and timeline milestones before transitioning to formal Aircraft Purchase Agreement.
Once the LOI is executed, the buyer may require an initial inspection of the aircraft to verify representations made by the Seller and to conduct an initial inspection of the aircraft and records to determine if they want to continue to proceed with the purchase process.
Once that document is signed, the preliminary aircraft and logbook review completed and the buyer wishes to proceed, you move on to the formal Aircraft Purchase Agreement with well defined terms and process of the proposed transaction, to include any third party pre-purchase inspection, delivery terms, representations, warranties and other standard provisions.
Phase 8: The Aircraft Pre-Purchase Inspection
It is important to be aware that private jet sales transactions can collapse during the pre-purchase inspection. In this process, you take the aircraft to the independent facility that you and the buyer have agreed upon.
The inspection typically involves several critical checks, including:
- Airframe Structure Inspections
- Comprehensive Avionics Testing
- Systems Checks
- Records Audit
- Flight Tests
The inspection findings classify airworthiness discrepancies as distinct from cosmetic items. There are also discrepancies of findings that don’t meet defined delivery conditions that may need addressed. The parties then agree on how to address any legitimate discrepancies and other outstanding issues.
Phase 9: Completing the Private Jet Sales Transaction
When selling a private jet, the closing process requires careful coordination between multiple parties. This includes the seller, buyer, brokers and a specialized aviation escrow agent as well as possibly aviation transaction attorneys and finance company representatives. The escrow agent is essentially a neutral gatekeeper. They hold the buyer’s initial deposit and collect essential paperwork from both sides.
The escrow company also searches official FAA and international registries to confirm the seller holds clean title to the aircraft. Unlike certain other types of assets, aircraft can carry debt across both the aircraft and its engines and various types of liens to include maintenance liens for unpaid vendor invoices, so the search confirms that the airframe and engines are free of filed liens for unpaid maintenance charges, tax claims or existing bank financing.
Phase 10: Delivering the Aircraft
The delivery flight represents the final operational step of a private jet sales transaction. This flight is usually conducted to a pre-arranged location with transactional tax considerations in mind. Your broker should take the lead in coordinating all of the parties involved in the aircraft movement and those individuals taking delivery for the buyer.
Once the aircraft lands and the buyer conducts a final visual review and signs off on delivery, the escrow agent releases purchase funds to the seller and the bill of sale to the buyer. At that point, if there are services, subscriptions or insurance you are paying for, you should ensure they have been transferred to the buyer or canceled as appropriate.
Get Expert Assistance When Selling a Private Jet
Selling a private jet is a highly technical transaction. To protect your asset value, you need to follow a disciplined strategy. By partnering with an experienced aviation sales organization like Axiom Aviation, you can navigate the phases above to achieve an optimal financial outcome.
Contact us to learn more about our private aircraft sales and brokerage, acquisitions, project management and consulting services.