INTERVIEW I 30 A n international platform for aircraft sales, marketing and ownership strategies for over 55 years, Jetcraft straddles both new and preowned aircraft markets. As the travel industry is heavily impacted by the coronavirus pandemic and the future remains unclear, Ultimate Jet asked Jahid Fazal-Karim, Jetcraft’s owner and Chairman of the Board, what does the Covid-19 mean for business. How is Jetcraft functioning during the quarantine? I’m happy to say that our staff and their families are all healthy and safe, and that Jetcraft remains open for business and ready to transact. We’ve been in business for over 55 years and persevered through our share of challenges, which has only made us stronger. I joined the company during the 2008 downturn and, since then, it has grown to be a highly functional, remote-based operation. Initially this structure was put in place to support travel schedules, offer flexibility for staff and service our global clients in every time zone, but it also fosters business resilience during times of crisis. What is the impact on your business? The pre-owned market has certainly been affected by the current economic situation resulting from the COVID-19 pandemic, and we are seeing some deals put on pause. However, at this stage, we don’t see any reason to panic and are advising our clients to remain calm while we have more visibility on the true economic impact of the world lockdown. We don’t know what the future will hold but, as of now, deals are still happening and there is still a good level of activity considering the situation. IADA has reported over 100 aircraft transactions amongst their membership since March and more than 50 additional aircraft under contract. Since government restrictions have been put in place, Jetcraft have signed multiple contracts and Letters of Intent and are closing aircraft despite the COVID-related issues. We’re also accepting trades and purchasing aircraft for our own inventory, so we have a lot of confidence in the market and industry right now. For those in the position to take a long-term view, there is plenty to take advantage of. A variety of quality inventory is available, interest rates are low and bonus depreciation still applies. We’ve seen some aircraft back on the market after recently completing PPIs, providing turnkey acquisitions at a great value for those ready to purchase.
BizAv has been through many crises before. The current crisis has a global impact, how is Jetcraft adapting to the situation? Our global presence is critical right now, as conditions are changing so fast in each region. We’re matching sellers with buyers around the world through our global network of 20+ offices. Moreover, we are one of few companies with the continued ability to take in trades, allowing us to help our customers avoid any risky crossover periods during this time. Jetcraft customers can remotely view aircraft they wish to purchase. All our aircraft are marketed using the most up to date and highest quality photos and videos and we can facilitate on-the-ground virtual aircraft viewings as needed. At the end of the day, the health and safety of our staff, partners, customers and their families is paramount. It’s too soon to tell what will happen, but our priority is to gather as much information as we can. We stand ready to serve our industry and to be a resource for anyone that needs us. This is a time for everyone in business aviation to double down on resources and capabilities in order to help our clients properly mitigate and manage through this period. What was the situation on the pre-owned market before the pandemic? Fortunately, the pre-owned market entered into COVID-19 at a healthy level. The overall market was relatively balanced with reasonable supply and demand, which resulted in reasonable values for pre-owned and new models. This is a major difference versus 2008 when manufacturers had long lead-times, there were speculative buyers, and aircraft were over-valued. In addition, many major corporations today have the cash reserves to sustain a crisis, Governments are acting faster to implement packages to help small businesses, and banks, although cautious, are still open for business. Ultimate Jet I 31