Bonus depreciation and the aircraft industry
November 28, 2011
Unless Congress grants a provision of President Barack Obama's $447 billion American Jobs Act to extend bonus depreciation
, the allowance - which is intended to boost business hiring and expansion - is set to expire at the end of the year.
Aviation International News Online recently gauged the effect of the provision on the aircraft industry. According to Shawn Vick, executive vice president of aerospace manufacturing company Hawker Beechcraft, the continued economic uncertainty is mitigating new fixed asset
"When people have more confidence, they will make decisions," Vick told the news source.
However, Nel Stubbs, vice president of business aircraft consulting firm Conklin and DeDecker, noted that the used-aircraft refurbishment market is benefiting from bonus depreciation.
"We've seen a lot of people using it to buy good used aircraft … (and) capital equipment for those aircraft," Stubbs told the media outlet. "Any capital improvement is entitled to the bonus depreciation so it has been a really good deal for the used aircraft markets."
According to a separate article by the news source, General Aviation Manufacturers Association president and CEO Pete Bunce acknowledged last month that the provision has been helpful to the airline industry in the wake of the recession.