JetSwiss Pilatus PULSE - January 2023

PILATUS PC-12 MARKET OVERVIEW FOR JANUARY 2023

SHOOT THE MOON

A brief disclosure: unlike last month, we will not be using planetary analogies to describe the market. However, in keeping with themes that paint a clear picture of the Pilatus market, we will continue to use colorful metaphors and analogies that enhance your reading enjoyment!

Growing up in the Midwest you don’t have a choice but to learn how to play cards, more specifically, the game of Pitch. There are several variations of this game, but the one “nuclear move“ that is overly zealous in its conclusion—Shoot the Moon.

For all you card players out there, you know exactly what we’re talking about. For everyone else, “shooting the moon“ means you take a limited amount of information (the cards in your hand) and you place a ‘nuclear conclusion’ wager on winning the hand. It’s an all-or-nothing move. If you don’t win the hand, you lose. Game over. Do you know where this is going? We’ve discussed this for several months... the Pilatus market did “shoot the moon.”

In previous Pulse editions, we mentioned that buyers who were motivated to purchase an aircraft before the end of the year for tax purposes accomplished this task by the end of the third quarter. That said, we saw a somewhat typical year-end run on aircraft purchases. JetSwiss delivered five aircraft in the last two weeks of December, keeping roughly ‘on par’ with December 2020 and 2021. Several of the sellers who were “Shooting for the Moon” were left at the alter come January 1st. They placed a large wager on being able to obtain a high premium for their aircraft and it remained unsold.

Where does that leave us now that we’ve entered 2023? Will those sellers continue to ask for the moon? Will they take their aircraft off the market? We’ve already seen a few of them lower their expectations. Remember, the market was garnering 104% to 131% of NEW STICKER prices for any one given model year through the 3rd quarter of 2022. This window has slid down a bit, now yielding closer to 100% to 128% of retail new sticker prices. (We would be happy to explain this in further depth, just give

us a call.) Will this slide be enough to garner interest from the marketplace? Are people willing to pay new plane prices for ten-year-old aircraft? Tough to say, but it’s our feeling that there are still buyers out there—but they are more persnickety than ever. Also, what additional aircraft will become available on the pre-owned market and where will they price themselves? Well, we know this answer will be largely influenced by ‘brokerville’, bad information, and greed—much of the same components that have influenced the market the past 18-24 months…

All these questions remain open as we enter the new year. Time will provide us with the answers, but what we do know is that actual sales data suggests that the market has plateaued. Shooting for the moon is not a sales strategy. It is wishful thinking that provides poor results. We are still amazed at how a large contingent of intelligent, entrepreneurial, CEO business owners make their decisions when selling their aircraft. I guess you can explain it by simple human nature. We all want to think we will win the lottery and we surely love being told what we want to hear! “Let’s go ahead and ‘shoot for the moon’ with our asking price Mr. Broker…” For the ‘other’ group of CEO’s, they take a different approach. They gather data, on top of data, with a side plate of data. They engage an expert who perhaps does not tell them what they want to hear initially (no plug here, just facts). Sellers that have the data available at their fingertips to properly evaluate their asset, comprehension of a fine-tuned and proven marketing strategy, and the expertise to execute on it all, will make all the difference between excellent and poor results.

Anyone can run an ad in controller.com. Addressing all the components that maximize pricing and minimize risk is where the professionals differentiate themselves. I am reminded of my father once explaining to me to “hire the best accountant and lawyer you can afford. Because, if you think it’s expensive to hire an expert, wait until you see what it costs you when you hire an amateur….”

Thanks, Dad!

ASKING PRICE VS. MODEL YEAR

This chart reflects the current market for Pilatus PC-12 aircraft that are on the retail market. Want to know how much your Pilatus dollars will buy? This is a great place to start. As you can see, the aircraft model year plays a key factor in pricing of the aircraft, and thus generates a commensurate trend curve. This data provides a baseline for our aircraft evaluations.

AIRCRAFT TOTAL TIME VS. ASKING PRICE

Similar to the Asking Price vs Model Year chart, this information helps our clients determine “the mileage on the car” for their specific budget. “Want to own a low time aircraft?” This chart will give you an indication on what you will spend. Note: aircraft under 1,000 hours total time historically yield much higher prices.

We love Pilatus. We love Pilatus projects. However, there are circumstances where it is in our client’s best interest to trade their aircraft. That was the case with this 2018 Cessna CJ3+ which delivered to its new owner the last week of December. In addition to this CJ3+, we have recently taken a Piper Meridian, Cirrus SR22, and other PC-12’s on trade. If you are considering purchasing a Pilatus aircraft but your circumstances are such that trading your aircraft is your best path forward, know that JetSwiss offers trade-in services!

SWISS IT FORWARD

The Swiss it Forward Program has three very simple principles:

• Allow the use of your Pilatus to introduce someone to general aviation or to the Pilatus brand.

• Use your Pilatus for a charitable flight (Angel Flight, Make a Wish, Veterans Airlift, your local church, or transferring baby mountain lions to a nature preserve, etc.)

• Help a fellow Pilatus owner in a pinch, emergency.

We plan to Swiss it forward this year by providing free transport to wounded veterans and those in need with our new wheelchair lift. If you know an organization or individual that could use a lift, please reach out.

Special thanks to Pro Star Aviation.

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