As to Chip’s comment above about folks who are worth in excess of $50 million in the US, I googled it, and it is about 110,000. Not a huge number to be sure, but certainly enough to move the needle when it comes to aircraft sales if they are inclined to buy.

If just 1% of those, 1100 people, decide to use GA instead of airlines, that's a huge swing in the market.

The frax and jet card operators are hugely booked since that's the easiest entry point for new customers at the high end. When they start using that a lot and/or get frustrated with the scheduling problems, then they move towards having their own plane.

Mike C.

That who I think it is??

I’m pretty sure no one here posted anything about an impact on the airlines. The airlines fly millions of hours a year transporting millions of passengers all over the world, and a spike in GA travel will not affect that in any reasonable way. We are discussing the impact on GA aircraft that are for sale. If the .001 percent that can afford it decide they wanna look into travel by GA airplane to avoid the airlines, that has a massive effect on the several hundred turbine aircraft currently on the market. At least on controller.

I know of a family that has had a jet for the last 30+ years. It had been run by a corporation until about 4 years ago when they sold off the last parts of that. 2 years ago they upgraded from a Falcon 50 to a 900 which they had refurbished the interior and paint.
The family was the 3 adult kids of the founder who had passed away several years back.
Last Nov 2 of the 3 families decided they no longer wanted the jet. 1 of the 3 used it the most but all paid equal amounts into the ops and flight dept cost.
It was gone by the end of Dec.
Now I hear they use Netjets.

So I guess nothing is forever.

It can change in a heartbeat. During the financial crisis of ‘08, a money crunch and no small amount of political shaming cleared out a lot of flight departments.

The business can turn on a dime.

50 to an upgraded 900 is a pretty big jump $wise.

Chip, is it common for non pilot owners to invest in avionics upgrades? Not speculating on whether this guy is a pilot or not, just wondering if there's a "sweet spot" on the KA line where you would see Garmin upgrades on older birds. For example: 350's would be less likely to have new glass as they are mostly professional flown as compared to 90's which would have a higher concentration of owner flown.

If just 1% of those, 1100 people, decide to use GA instead of airlines, that's a huge swing in the market.

The frax and jet card operators are hugely booked since that's the easiest entry point for new customers at the high end. When they start using that a lot and/or get frustrated with the scheduling problems, then they move towards having their own plane.

Mike C.

That who I think it is??

That is a FACT!

I’m pretty sure no one here posted anything about an impact on the airlines. The airlines fly millions of hours a year transporting millions of passengers all over the world, and a spike in GA travel will not affect that in any reasonable way. We are discussing the impact on GA aircraft that are for sale. If the .001 percent that can afford it decide they wanna look into travel by GA airplane to avoid the airlines, that has a massive effect on the several hundred turbine aircraft currently on the market. At least on controller.

Solipsism is a practically universal human trait. It is certainly a very American one, especially as it pertains to the rest of the world. And yet it is a fundamental fallacy. Almost no one thinks the way we do. At least outside of the socio/economic/demographic group we swim in.

That's why many can't understand, no matter how hard they try, why others do what they do. The problem is that they look at other's decisions through their own lens of values, capabilities and so on. So, you end up with threads populated with comments like this one where a very practical, experienced comment by someone like Chip can be debated, denied, and completely misunderstood.

The fact is, with respect to the comments Chip has made about wealthy people and their capabilities, he's right. It's true that many wealthy people have traditionally flown the airlines. And Covid by itself didn't trigger a large rush to jet cards and airplane ownership. It was just a tipping point. That tipping point came after an increasingly, over years, decline in service, convenience and comfort. Covid, with it's increased hassles, health risks (real and perceived), reduced service, convenience and comfort coupled by dramatic increases in boorish behavior on the part of other flyers has probably pushed many over the edge.

And, when you can afford to make a different choice, and you start looking at options, flying privately gets very attractive. And if you can afford it why would you want to ever go back to the worsening experience I've described. You wouldn't. And it has nothing to do with the economic issues of the last couple of years.

Are there some who are flush with PPP money burning a hole in their pockets? Yes, I'm sure there are. But the people who can afford to buy, on cash or credit, multimillion dollar airplanes aren't usually the foolish rubes some of you tend to think.

The "millionaire next door" is a real phenomenon in the U.S. These are people who save, invest and live frugally and likely would never fly privately. They are "rich". But they are far from the only ones. Many others have generational wealth. But, just by the numbers most "millionaires" (not necessarily rich) and a majority of the "ultra high net worth" people Chip is describing, and who are fueling the buying boom we're talking about made their own money. They might sell their planes later but, as he points out, it won't be because they have to.

For those not like them their behavior violates norms, defies understanding, in some engenders jealousy and envy, but on the whole is just not rational or understandable. Solipsism rules and leads to error.

I blandly suggested to my wife that we could sell our airplane for a nice profit in the current market. She didn't care to because we'd have to take the airlines to our home in California which she doesn't want to do. Me either. And not just because I'm a pilot but because I intensely dislike all the attributes of commercial flying today that I listed above. It has nothing to do with PPP, Mainstreet, COVID, or any other current event. It looks like I have plenty of company.

I think the current surge in the prices for jets is reflective of their actual value in the real world. A well maintained jet lasts a long time and it’s performance and capabilities don’t deteriorate over time. Thus, why should its price deteriorate more than the asset itself? I think the low values we saw in prior years were unusually low and suppressed by a lack of buyers. Now the shoe has moved to the other foot and will likely stay there for a while.

Learned a new word today from Tony:

https://www.merriam-webster.com/dictionary/solipsism

One never stops learning!