Newly wealthy private jet buyers are skipping the starter PJ and going bigger, private aviation CEO says

First-time jet buyers are going big from the start, the founder of a private aviation company said. Joan Valls/Urbanandsport/NurPhoto via Getty Images First-time jet buyers are skipping smaller aircraft and opting for larger, pricier models instead, Craft CEO Israel Slodowitz said. The private aviation CEO said the industry was seeing an "insane wealth creation moment," pointing to AI and tech. Slodowitz warned of a coming jet shortage as demand among the wealthy increases. A new wave of wealth is already transforming the private jet market — and first-time buyers are going big off the bat, according to one aviation CEO. Israel Slodowitz, the founder and CEO of private aviation company Craft, said during a recent episode of the "Sourcery with Molly O'Shea" podcast that these customers are increasingly bypassing the traditional entry point into private flying . "We're seeing people entering the market buying bigger airplanes," Slodowitz said, adding that newcomers who once would have started by chartering flights or purchasing a smaller aircraft are gravitating toward larger, more expensive jets from the outset. More buyers, he said, are opting for super-midsize aircraft such as the Bombardier Challenger 350 or even larger heavy jets like the Gulfstream G450 — categories where aircraft can cost in the tens of millions of dollars range. "They're going straight towards buying or even chartering the latest and greatest," Slodowitz said. The trend is being fueled by a new generation of wealth stemming from the AI and technology sectors, said Slodowitz. He pointed to Elon Musk's rocket company SpaceX , which made its historic Nasdaq debut earlier this month, and ChatGPT-maker OpenAI's anticipated IPO . "We're seeing like not just an insane wealth creation moment — probably the largest we've seen in the history of humankind — but we're also seeing a shift in how people spend their wealth and their priorities," Slodowitz said, explaining it's "completely new money." "So there's like this massive tsunami that's hitting, and we're seeing it in our business; we're seeing it in the preferences of what people are choosing, and how they're accessing private aviation," the CEO added. Slodowitz, whose company would stand to benefit from increased spending on private jets, said he expects the population of PJ users to more than double, creating a "huge cataclysmic effect" on the industry that could lead to a jet shortage as demand outpaces supply. Slodowitz did not respond to a request by Business Insider for further comment. While airplanes are generally considered depreciating assets, Slodowitz said that's starting to change. "They don't go up in value normally, but we're seeing them go up in value for the first time almost ever, especially in the higher end of the market," he said. "So that small little change in wealth, which I think is actually huge, is something this industry is not at all ready for." "There's going to be a lot of adjustment and price fluctuation and uncertainty until the new wave sort of takes effect," he added. Read the original article on Business Insider