Aircraft Sales Insights

A Service of Dallas Jet International

The Reincarnation of a Fleet Business Jet

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We frequently mention that our relationships create unique opportunities for our clients.  The opportunity to acquire aircraft that are not officially “on the market” is one of those advantages.  This quick story of the reincarnation of a fleet business jet from a well-known jet company that became a treasured and highly customized private jet is an example of how that advantage can work for our clients.

We regularly purchase well-maintained, professionally flown aircraft from fleets such as NetJets for our clients.

NetJets prides itself on having a very large and very young charter fleet.

The current average age of charter aircraft in the U.S. is over 15 years, more than double the average age of the NetJets fleet. NetJets is taking delivery of hundreds of new NetJets Signature SeriesTM aircraft entering the fleet in the coming years. The deliveries span every cabin class and will enable NetJets to have the youngest fleet in the sky.

www.NetJets.com

A fleet business jet by Netjets can become an excellent personal aircraft

While these are often high-time aircraft, the aircraft sale price reflects that. This creates a unique opportunity for private owners to purchase “more plane” with their money.

The charter fleet décor is designed to be discreet and neutral. For our clients that want their aircraft to be a mobile office or apartment that reflects their branding and personality, we can arrange for interior, exterior and engine overhauls that create a very custom and beautiful airplane that meets a client’s specifications perfectly.

DJI’s relationships with NetJets, our import and export expertise (to acquire aircraft from any location in the world) and relationships with great companies that perform maintenance, paint, interior and avionic modifications and engine manufactures give us the depth and experience we need to make this a seamless and transparent process for our client.  Most of our clients that purchase a Netjet aircraft will perform new paint, interior and engine overhauls.  Many of our partners, including NetJets, are fellow NARA (National Aircraft Resale Association) members.  Our clients, therefore, receive more options and value than they would without our network of resources.

Repeat business is the best indicator of success.  We have completed this process for several clients over the years, and we’re working with one client again to acquire another “custom NetJets” airplane.

This opportunity is best for a person or business that has cash available to purchase and customize an aircraft.

Give us a call today at 817-520-4009 and let’s talk about your situation.

Gulfstream IV SP Aircraft Renovation – Before and After

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Dallas Jet International (DJI) is considered a “stocking dealer.”  This means that we are  able to purchase and take possession of aircraft, and hold them in inventory. Aircraft renovation projects are ideally suited to this business model.

GIVSP Renovated by Dallas Jet International

GIV SP Aircraft Renovation by DJI

This gives us the opportunity to assist customers whose aircraft need some work to make them more attractive in the current market. Also, some financial institutions and other aircraft owners may have accounting rules that keep separate funds for operations costs and upgrade costs.

DJI does not have these restrictions. We can do an overall financial analysis and market analysis, determine our opportunity cost, and purchase the aircraft with the intention of remodeling it and subsequently sell it.

This creates a win/win scenario. Our client is able to have immediate use of funds from the sale without spending cash from other funds, or taking additional risk of managing a project that’s simply not in their realm of expertise.

Experienced aviation professionals are well aware that an error in calculation or a mistake during the renovation process can be an expensive proposition; and are very insistent that only experienced experts are involved in financing aviation renovation projects.

The client who eventually purchases this aircraft will enjoy a lower cost because of DJI’s efficient management of the process, along with peace of mind knowing that the renovation was overseen by experts with end-to-end knowledge of each step in the process.

As an example, this  Gulfstream GIV SP needed work to make it airworthy, and needed interior and paint work to make it more marketable. DJI purchased the aircraft outright from the financial institution.

DJI completed the financial analysis and prebuy inspections.   We closed on the purchase, and took the airplane to a maintenance facility.

We  had the engines removed, crated, shipped, overhauled, reshipped and reinstalled.

Meanwhile, the interior, paint, and other maintenance was being completed.

Of course, the sooner we are able to get the aircraft ready for a new client, the better from a financial perspective; and we can pass those savings on to the new client who purchases the aircraft from us.

Here is the completed GIV SP with new paint, updated interior, electronics and appliances.

If you are considering selling an aircraft and wonder if an aircraft renovation would improve its market positioning, give us a call at 817-520-4009 and let’s talk about the options!

The Aircraft Ownership Life Cycle

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ChallengerA good aircraft ownership experience is when the airplane serves the transportation needs of the client cost effectively for a number of years, and then has a “good exit” when sold or traded.

The goal is a good value to the client throughout the entire process.

Aircraft ownership involves great rewards, and like any rewarding endeavor, it also involves some risk. It’s our job to help you manage that risk to your level of comfort.  It’s also our job to help balance your preferences on other factors such as convenience, comfort and economy.

If we’ve done our job correctly, we create the ideal entry strategy AND exit strategy for your situation.  The result is a successful ownership experience that provides maximum benefit with no surprises.

Aircraft Ownership – Entry Strategy

The first step DJI will take to reduce your risk is to perform a thorough needs analysis.

We will need to know your typical “mission profile.”  Our initial conversations will include questions such as:

“Where do most of your trips take you?”

“How frequent are your trips?”

“How many people will be traveling?”

“Is there any special baggage requirements?”

And so on . . .

We will also want to know your financial strategy and objectives.  Would you prefer to purchase a more expensive airplane that has lower operating costs; or would it be better for your position to conserve your capital on a less expensive aircraft that will have higher maintenance costs scheduled further down the road?

From an insurance perspective, we’ll discuss the options. Most aircraft insurance carriers insure for “hull value” plus liability exposure.   In layman’s terms, in the very unlikely event of an incident, what are you worth? What is the company worth?

Will you employ your own crew or do you prefer to have that managed for you?   Your flight crew will need to set up an appropriate operations manual, standard operating procedures (SOPS), an RVSM manual (RVSM stands for Reduced Vertical Separation Minimums) and other documentation and policies for overseas flights such as MNPS, (Minimum Navigation Performance Specification) and policies for RMP5 and RMP10 airspaces over the North Atlantic and Pacific; based on your preferences for balancing convenience, speed and risk tolerance.

DJI understands the aircraft on the market that can meet your travel needs and financial strategy, maintenance costs, fuel costs, insurance requirements, and crew requirements.  We balance these and many other factors that play into the choice of aircraft type.

Individual aircraft of the same type can vary a great deal in performance. It is vital to select an appropriate aircraft with pedigree, maintenance history, and documentation.

Of course, getting into the perfect aircraft is only half of the story of a successful aircraft ownership experience.

Aircraft Ownership – Exit Strategy

Many things can change over the course of three to five years (the average aircraft ownership time frame) but a planned exit strategy at purchase provides several advantages.

If we know the approximate ideal “exit date” based on your strategy, the growth projections of your company, and the maintenance cycles of your particular aircraft, we have the option to manage risk toward the end of your ownership time frame.

We can advise you on the resale value versus ongoing cost of your aircraft. Factors can include the number of engine cycles, maintenance cycles, paint and interior time, major events that have taken place during your ownership, and the market fluctuations that affect the value of your aircraft (and the one you may want to move into!)

Conclusion

It’s our objective to ensure that every aircraft owner has a successful ownership experience. As you can see, success involves far more than the initial purchase.  Our process ensures the best results over the entire ownership cycle with each successive aircraft you own.

Some aircraft brokers are concerned with your needs at the time of the transaction, but DJI’s focus is relationships with our clients over a lifetime.

Challenger

Brad Harris

FOUNDER AND CEO
As founder of Dallas Jet International, Mr. Harris has established an esteemed 23-year aviation career.  He holds of Bachelor of Science Degree in Professional Aviation and Airway Science and and a Masters Degree in INdustrial Organization Psychology from Louisiana Tech University.   Mr. Harris entered the aviation industry in 1992 as a corporate pilot for a Fortune 500 corporation and soon started a successful aircraft leasing and renting company.

In 1993, Mr. Harris began his aircraft sales career and became one of the most highly respected aircraft brokers in the world. In 2002, Dallas Jet International began offering aircraft sales, consulting, and brokerage services. Mr. Harris is a current airline transport pilot who is type-­rated in ten (10) different jet aircraft including the Gulfstream 550, 450, 350, GV, GIV, GIII, GII, Hawker, Falcon, Citation, Beechjet, Lockheed JetStar II, Diamond Jet and King Air 300 / 350. Mr. Harris parlays extensive hands-­on knowledge and experience into clear results for his clientele. His firm has set up flight departments, consisting of aircraft crewing, aircraft management, aircraft maintenance and aircraft operating budgets, for several clients. Mr. Harris also possesses significant entrepreneurial experience in real estate and commercial insurance. This knowledge, combined with unparalleled experience in all facets of corporate aviation, is the foundation of success for Dallas Jet International. He often speaks to groups of aviation professionals, publishes monthly blog articles and sits on the Advisory Board for GE Capital Corporate Aircraft and Finance, and CAE Simulflite. He currently sits on the board of Directors at NARA (National Aircraft Resale Association) as President.

Did you Know DJI has an Aircraft Dealer Division?

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Dallas Jet is an aircraft dealer or stocking dealerDallas Jet International (DJI) is an aircraft dealer- which means we are always a buyer of corporate aircraft.

Dallas Jet International is one of the largest bidders / buyers of aircraft in the industry. The company is routinely called on to purchase trade-­in aircraft from manufacturers and other aircraft brokers, as well as repossessions and lease returns from aircraft lending institutions.

Aircraft owners from around the world value DJI’s unique ability to buy their airplanes for resale inventory, saving owners the delay of retail marketing. In over 90% of instances, upon receipt of all specification / maintenance reports on a given airplane, DJI provides an offer within 48 hours to buy that aircraft, subject to normal transactional guidelines.

This experience in buying and selling our very own aircraft translates into significant benefits for the company’s consulting and consignment clientele. DJI understands what it is like to buy, own, and sell an aircraft better than anyone simply because we do it all the time.

Dallas Jet International (DJI) is considered a “stocking dealer.”  This means that we are  able to purchase and take possession of aircraft, and hold them in inventory. Aircraft renovation projects are ideally suited to this business model.

This gives us the opportunity to assist customers whose aircraft need some work to make them more attractive in the current market. Also, some financial institutions and other aircraft owners may have accounting rules that keep separate funds for operations costs and upgrade costs.

DJI does not have these restrictions. We can do an overall financial analysis and market analysis, determine our opportunity cost, and purchase the aircraft with the intention of remodeling it and subsequently sell it.

Whether you are interested in buying, selling or trading, DJI’s relationships and economies of scale, as well as our position as a respected aircraft dealer can benefit your transaction.

Off-Market Aircraft – An Overlooked Source of Win-Win Jet Sales Transactions

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Aircraft  that are publicly listed (like this beautiful Gulfstream IV) represent a small percentage of the aircraft available to acquire.

Airplanes that are publicly listed (like this beautiful Gulfstream IV) represent a small percentage of the aircraft available to acquire.

Not all aircraft are marketed or traded on the open market. This is common in many industries outside of aviation. Some of the most valuable transactions taking place in the world today are conducted confidentially for off-market aircraft through brokers experienced in a particular industry.

Why Off-Market Aircraft can be the best deal?

In the aviation marketplace, certain sellers cannot advertise their aircraft due to competitive pressures, public perception, or privacy / personal security issues. In these cases, the airplane is sold through tight broker networks, of which DJI is a part. DJI’s buyers benefit from DJI’s knowledge of the off-­market aircraft. They often represent the best values available.
As with any type of transaction, the more options available to a buyer, the better negotiating position the buyer has. With DJI’s off-market knowledge, our clients have access to 10 to 30% more aircraft than they would have on public websites and classifieds.

Brad Harris

FOUNDER AND CEO
As founder of Dallas Jet International, Mr. Harris has established an esteemed 23-year aviation career.  He holds of Bachelor of Science Degree in Professional Aviation and Airway Science and and a Masters Degree in INdustrial Organization Psychology from Louisiana Tech University.   Mr. Harris entered the aviation industry in 1992 as a corporate pilot for a Fortune 500 corporation and soon started a successful aircraft leasing and renting company.

In 1993, Mr. Harris began his aircraft sales career and became one of the most highly respected aircraft brokers in the world. In 2002, Dallas Jet International began offering aircraft sales, consulting, and brokerage services. Mr. Harris is a current airline transport pilot who is type-­rated in ten (10) different jet aircraft including the Gulfstream 550, 450, 350, GV, GIV, GIII, GII, Hawker, Falcon, Citation, Beechjet, Lockheed JetStar II, Diamond Jet and King Air 300 / 350. Mr. Harris parlays extensive hands-­on knowledge and experience into clear results for his clientele. His firm has set up flight departments, consisting of aircraft crewing, aircraft management, aircraft maintenance and aircraft operating budgets, for several clients. Mr. Harris also possesses significant entrepreneurial experience in real estate and commercial insurance. This knowledge, combined with unparalleled experience in all facets of corporate aviation, is the foundation of success for Dallas Jet International. He often speaks to groups of aviation professionals, publishes monthly blog articles and sits on the Advisory Board for GE Capital Corporate Aircraft and Finance, and CAE Simulflite. He currently sits on the board of Directors at NARA (National Aircraft Resale Association) as President.

Dallas Jet International – An Emphasis on Relationships with an Operational and Technical Perspective

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Dallas Jet International is a member of the National Aviation Resellers AssociationProfessionals who pride themselves on prioritizing the focus of each transaction appropriately own Dallas Jet International (DJI). Long-term relationships come first, business objectives second, and aircraft third. This long-term focus and emphasis on the people and business that the aircraft will be serving ensures that each decision is made in the best interest of the client, many of whom have relied on DJI to represent their interests in multiple aircraft transactions over many years.

 

DJI is owned and managed by former professional pilots and aircraft managers who stay current and active during the free time away from the business. President and CEO Brad Harris and Managing Director of Aircraft Sales Shawn Dinning are experienced ATP pilots with current type ratings in 13 different aircraft from Citation 500 to Gulfstream G550. They have more than 13,000 flight hours between them. An aircraft sales professional with an operational and technical background can more fully assess and appreciate a particular aircraft’s strengths, weaknesses, opportunities and risks. Harris and Dinning use this depth of knowledge to their clients’ advantage.

 

DJI operates independently and is at liberty to transact within any make or model of aircraft. Their sole criteria is to ensure the best match with the client’s needs, exclusively representing buyers during aircraft acquisitions, thus preventing conflicts of interest. Harris and Dinning rely on excellent strategic market intelligence, ability to negotiate and expertise with complex transaction structures for clients with diverse financial positions and strategies. They use the latest technology to research and list aircraft, and they have cultivated an extensive network of industry relationships to find information and aircraft unavailable to many competing brokers and agents.

 

DJI has managed numerous aircraft in the past, and continues to manage aircraft for certain local clients. DJI clients now have access to one of the industry-leading charter/management and maintenance operations with DJI’s announcement of its brand new business alliance with Pentastar Aviation, a large Pontiac, Michigan-based Charter/Management and MRO (maintenance) company. While brokering aircraft transactions is a large part of DJI’s business, the purchase of aircraft into inventory for resale is becoming an increasingly big part. DJI is putting the message out to owners, brokers, banks, etc, that the company is in the market to buy aircraft, including trade-ins and repossessions.

 

“Buyers and sellers need expert representation in the business aircraft marketplace,” explains Brad Harris. “We manage the complexities of the process from start to finish to our clients’ advantage. While we are often labeled as ‘brokers,’ our clients call us ‘trusted consultants’ who rely on us to buy, sell or manage their aircraft in a manner that meets their objectives with the best possible financial results.”

 

Shawn Dinning adds, “Never underestimate the value of a reputable broker. Our clients benefit from the fact that aircraft buyers and sellers (who are not represented by DJI) prefer to work with clients represented by DJI because they know they will have a smooth transaction process.” Dinning advises anyone who is hiring a broker to really get to know that firm’s background, aviation experience and reputation within the industry.

 

Founded by Brad Harris in 2001, Dallas Jet International joined the National Aircraft Resale Association (NARA) in 2008 because the company wanted to be part of a group that creates a competitive advantage for members and their customers by leveraging a global collective knowledge and maintaining the highest professional standards.

 

For more information about Dallas Jet International and their capabilities, visit their website at http://www.dallasjet.com/ or call the Southlake, TX, office at 817.328.2900 or the Dallas, TX, office at 214.459.3303.

This article was originally published in February 2012 on the NARA blog.

Dallas Jet International on the cover of Executive Controller Magazine

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Executive Controller, January 2012

Photo,Taylor Greenwood Photography