Pre-buys or pre-purchase inspections (PPIs) are critical to the aircraft acquisition process, ensuring the aircraft meets the required technical and airworthiness standards. It can be a complex area, with varying financial implications. But what are some of the common issues that arise from the process that buyers and sellers should be aware of? JSSI’s George Kleros, SVP of Advisory Services, recently spoke with AvBuyer about best practices for PPIs.
Kleros says a PPI should always be considered a mandatory step in the transaction process, adding that the complexity of the process is often impacted by such factors as the aircraft’s age and operating region. However, the PPI “may have been overlooked during the pandemic as one of the seller’s conditions to expedite the sale.”
Who pays for any issues the PPI identifies? “Typically, the issue of who pays for what following a Pre-Purchase Inspection will be clearly identified in the aircraft purchase agreement,” says Kleros.
“Airworthiness squawks – which require corrective action immediately to allow the aircraft to fly – usually default back to the seller. Non-airworthy discrepancies such as exterior/interior cosmetic issues or wear-and-tear could be deferred and deflected back to the buyer,” he explains.
There may be concessions on either side, but “it all depends on the willingness of the seller and buyer to compromise and come to an agreement.”
Read the full article here on AvBuyer.
Please note that if the aircraft sells with a maintenance program, your transaction advisor should work hand-in-hand with your program provider to design the proper work scope.
