Hobbyists and business owners have long been ready to capitalize on the opportunity unmanned aircraft systems (UAS), aka drones, provide for both fun and commercial activities. The multitude of possible applications for UAS permits have been on hold pending Federal Aviation Administration (FAA) action regarding the rules and regulations for unmanned aircraft. With potential applications running the gamut from delivering packages to innovating the forestry and farming industries, the noise around drones and what they could do to improve human lives is staggering.
Will FAA rules stymie commercial drones?
But the FAA’s recently released first draft of its Small UAS Notice of Proposed Rulemaking leaves would-be commercial and private drone operators wondering whether they’ll ever be able to fly their drones legally. The list of limitations includes:
- Drones must fly within the operator’s line of sight at all times.
- Drones may not fly over people.
- Drones may not operate at night.
- Drones may not fly higher than 500 feet above the ground.
- Drones may not fly faster than 100 miles per hour.
The rules are part of a multi-phased approach to integrate drones within the U.S. National Airspace System (NAS). Federal officials envision allowing drones to perform duties such as aerial photography, crop monitoring, and inspection of cell towers, bridges, and other tall structures — but the limitations are making many proposed applications impossible. Among the list of disappointed companies is Amazon, which wanted to use drones to create a faster delivery system and has threatened to move its operations to drone-friendly nations if the restrictions are not lifted.
Hobbyist drones proliferate
In the meantime, hobbyist drone operations have escalated as drones appear for sale online and in some stores. As hobbyist drone usage increases, so have incidents of lost drones, called “flyaways.” The Washington Post reports that since 2009, public agencies have reported 23 accidents and 236 unsafe incidents with civilian-piloted drones.
Along with concerns about drones’ safety have come concerns over privacy, which have been far more pressing in the court of public opinion and have caused some people to register their properties as No Fly Zones. As drone laws continue to take shape, the upcoming months will reveal the fate for many commercial drone dreams when the FAA makes final rulings.
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2014 continued to be a buyer’s market for pre-owned business jets. Even so, according to data from JetNet, used business-jet inventories in December 2014 dropped to 11% — their lowest point since 2007 and a 1.5% decline year over year, as reported by AINonline.
The year-over-year retail transactions for used business jets surged by over 8% in December, hitting a new record of 2,569 pre-owned jets. However, the average asking price for pre-owned business jets continued to slide by over 10%.
While the number of in-operation business jets has continued to grow over the past several years, up until last year, pre-owned aircraft inventories had remained fairly stable, declining by less than one percentage point per year between 2011 and 2013, as reported by JETNET. The significant drop in pre-owned inventories bodes health for the market overall.
Pre-owned Gulfstream models a good buy
In the wake of Gulfstream’s delivery of its G650 to a waiting list of wealthy buyers, quite a few G550s are now for sale. CNBC reports that more than 30 used Gulfstream G550s are currently for sale, up from 11 a year ago. A 2006 G550 can be purchased for less than $30 million, around 60% of its original retail value. With the increase in G550 inventories, prices could fall even lower, possibly enabling individuals or business that previously couldn’t afford a private jet to do so.
Sales of older airplanes have typically been cash only, with models priced far below market value. For example, Gulfstream’s GIV models, originally priced at $36 million in 1998, now sell for $3 to $4 million. Financing for these older models has been almost nonexistent. However, recently some financial institutions have started offering aircraft loans, including financing for older aircraft, reports Business Jet Traveler.
If you are a jet owner and considering upgrading your current business jet to a newer model, now appears to be a favorable time to sell — before a flood of pre-owned jets hits the market and drives down values.
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There’s a mobile app for just about anything you want to do: from checking the weather to ordering takeout to tracking your health — and now, even for booking a private jet flight.
The latest trend in charter flights is to book them through various smartphone apps. Inspired by the popular ride-sharing service Uber, the idea has now branched into private aircraft.
Just as Uber made getting a ride easier, a range of private jet apps is doing the same thing. Apps such as JetSmarter, FlightTime, and BLADE allow you to book a flight to your destination with a few taps on your smartphone.
The process of connecting with a private jet charter is quite simple: users plug in their travel dates, departure location, and destination and view available flights. From there, they can compare prices, view specs, and even see images of the aircraft.
Why use a charter-booking app?
One of the most important benefits of using an app to book a charter flight is sheer speed. The entire process of locating and booking a flight can take just a few minutes, and many private jet services can take off within an hour of booking.
Another benefit is cost savings. In eliminating the broker, the apps enable customers to save significant money on air charters. Many of the apps let time- and money-conscious users take advantage of “empty leg” deals — booking empty seats on private jets that are returning to private airports or heading to popular destinations half-full.
Bringing private jets to the masses
The success of these apps has surprised many in the bizjet industry, including the creators of the apps themselves. The apps are bringing private flights to a wider population than just business executives and the wealthy, and they’re helping to maximize jet owners’ ROI by reducing seat vacancies.
Even as wealthy families are paying as much as $500,000 for a private flight — all booked through their iPhone — flight-booking apps are making charter jet travel almost a commodity by offering much lower-priced seats to customers. Such apps could have a significant impact on the market for private jet travel.
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sales@L-Lint.com, call us any time at +1.305.754.3313, or
visit us online.
The turnaround in the U.S. private jet market has finally reached the small- to medium-sized jet sector. A period of frugality, brought on by the U.S.’s recent economic struggles as well as the public’s negative perception of corporate jet usage, may have finally come to an end.
Smaller-jet shipments are up
As the home of approximately two-thirds of the world’s fleet of light to midsized jets, the U.S.’s continuing economic recovery is spurring jet sales. The General Aviation Manufacturers Association (GAMA) reports that midsize and light jet shipments increased by 12% in 2014 over the previous year. In the same timeframe, the demand for light and superlight jets increased a significant 19%.
Compare these facts with the reduction in large-cabin, long-range jet shipments, which declined more than 10% in 2014, according to GAMA. The numbers indicate that the market for smaller used jets is primed and ready.
Fuel prices, new models also drive demand
Other factors are contributing to the increase in small to midsized jet sales. They include lower fuel prices and the release of a number of new and upgraded midsize aircraft models: among them the Embraer Legacy 500, Bombardier Challenger 350, and Cessna Citation X+.
In addition to these, the much-anticipated HondaJet, a very light jet (VLJ) aircraft, should finally be available by Q2 of this year.
As entrepreneurs and business owners consider how to maintain business growth in a flourishing economy, they’re looking more favorably on business jets as a corporate investment. Many of those same business owners also have big cash reserves and are more willing to open their checkbooks now than they were several years ago. With the economic outlook strong and business leaders optimistic, the bizjet market outlook is promising for 2015.
Contact L & L International if you need assistance in purchasing or selling a private jet.
You can reach our sales specialists today at sales@L-Lint.com, call us any time at +1.305.754.3313, or visit us online.
