Bluebook Perspectives: Pre-owned Market Sends Mixed Signals Throughout Industry

For current generation business jets (turbofan, EFIS, FANS capable, etc.), we’ve taken a random sampling representative of the medium- and long-range category aircraft.  Nearly the same percentage of the available fleet (~10 percent) is on the market through December 2013 as was at the end of 2012.  In the case of the GIV, Challenger 605 and G550, the percent increase/decrease was negligible.
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Bluebook Perspectives - Value Retention In Today's Market

By Dennis Rousseau | President and Founder | AircraftPost.com

There has been conversation and many questions over the last few years relating to residual values, value retention, value as a percentage of cost new, values coming back, et al. For years, our industry used a 3 to 4 percent annualized depreciation schedule to gauge future values for business jets. Due to the fact our business was in its infancy, we did not possess formidable history to determine the validity of the schedule. When we buy-in to the fundamental assumption that aircraft are depreciating assets with a 30-year life cycle, most business jets will reflect an average midlife (15 years) value retention of 50 percent, when compared to the original cost new.  

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YTD Pre-owned Transactions & Prices Continue Down

When viewing a random selection of pre-owned transactions for the first 5-months of 2013, the number of sales are trending down 15 percent when compared to the same period in 2012. Actual selling prices also are down on average 15 percent, while inventory levels for the same group of business jets has increased 20 percent.
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BLUEBOOK PERSPECTIVES

Thumps & Bumps in the Pre-Owned Market

Vol. 26, No. 2 | June 6, 2012 | Go to Charts
by Carl Janssens, ASA | Aircraft Bluebook — Price Digest

Optimists see the silver lining behind the cloud while the pessimist only sees the cloud. Optimism continues to be the silver lining in the pre-owned aircraft market. However, reality of the dark cloud dictates an awareness and calculated approach.
Such are the conditions in the current ever-evolving pre-owned market. For the most part, the glory days of aircraft values being treated as premium investment opportunities are now nothing more than a faded memory. Knowledgeable buyers and sellers are keenly aware of this. Change of ownership continues at a slow to steady pace while values for the most part show continued depreciation. The exceptions are late model long range executive business jets.

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Chinese GA Company Buys 10 King Air Turboprop Aircraft from Hawker Beechcraft for Pilot Training, Aerial Mapping

Hawker Beechcraft Corp. in Wichita, Kan., is selling 10 King Air twin-engine turboprop general aviation aircraft to the Chinese aviation company Avion Pacific Ltd. in Shenzhen, China, for about $50 million. Avion Pacific will use the King Air 350i and King Air C90GTx aircraft for VIP travel, pilot training, aerial mapping and weather modification. Deliveries are to begin this winter.

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Business Aircraft Market Recovering Despite Economic Woes

While doubts persist about the United States in an economic recovery, the business aviation sector is not following suit. For instance, late-model, large-cabin, long-range aircraft are selling at or above values published in the Aircraft Bluebook.
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Used Aircraft Market Shows Signs of Better Days Ahead

Finally, the pre-owned aircraft market moved in a positive direction in the first quarter of 2010. Late-model, large-cabin, long-range aircraft were selling at or better than values published in the Aircraft Bluebook.

External factors such as increased sales, a slight decline of available inventory and world market competition could all be considered causes for the improvement. Although this early indication of a slow recovery is in progress, it is too early to celebrate. Any positive sign going forward is far better than where the used aircraft market has been.

With the exception of the late-model, large-cabin class, most of the other business aircraft are not yet recovering in value. The good news is that values are showing more stability. Market activity is on the rise leaving a more optimistic perception that values are not exposed to the risks experienced in the last twenty months.

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Aircraft Prices Remain Stable While Signs of Recovery Glimmer in Dubai

Entering its home stretch, 2009 certainly has been a forgettable year for general aviation. The losses in value for most owners of corporate aircraft have been significant and, at times, have even been heartbreaking. However, something is happening out there. While economists predict an economic recovery will be achingly slow, some aircraft values are moving up. The change is barely perceptible and does not apply to every market segment. But inventories are finally contracting instead of expanding, and dealers are again becoming cautiously optimistic.
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