“Time is our most precious commodity, and there are conveniences that wealth brings to essentially get you more time. —retired Microsoft CEO Steve Ballmer, explaining why he commutes via private jet from his Seattle home to watch games of the Los Angeles Clippers, the basketball team he bought last year for $2 billion. ”
Preowned: August-September 2007
Bigger isn't always better, which is one reason many attendees like the European Business Aviation Convention and Exhibition (EBACE), which takes place in Switzerland each May. They see it as a scaled-down version of the National Business Aviation Association (NBAA) convention that is held annually in the U.S. And they laud the Geneva Convention (as many refer to it) for its more intimate setting and because-despite much lower attendance than the U.S. show-many exhibitors believe it attracts more serious buyers.
In Geneva this year, the sun-soaked static display of approximately 50 aircraft included relatively few used jets. For the most part, they were large aircraft that have been in high demand, like the Boeing Business Jet. The market for that model has been on fire lately, with prices rising quickly from around $45 million to about $55 million. Now, one BBJ that was displayed at Geneva reportedly is under contract for more than $60 million-prompting the owner of the only one remaining for sale to chart new territory with an asking price above $65 million. Referring to the current escalation of prices and what buyers are willing to pay, one of my counterparts at the show asserted, "Crazy doesn't exist anymore."
While talk of ruble-laden Russians buying up everything with wings is pervasive right now, the reality may be somewhat less exciting-at least it was at EBACE. In fact, a few weeks after the show, all of the used aircraft displayed there were still being marketed actively. As noted above, one BBJ is under contract, but its U.S. buyer surfaced prior to the show. From that standpoint, EBACE may be much like the U.S. convention, where relationships are often initiated and then cultivated, allowing for a sale to follow later on.
It was a bit surprising to see so many familiar faces in Geneva, which brings to mind the only complaint I heard about the event: "There are too many American accents this year. I hope this doesn't turn out to be like NBAA." Interestingly, that comment came from a foreigner at the show-an American!