|
LAST QUARTER 2011 MARKET CONDITION REPORT
Globalair Article – November 2011 By Jeremy R.C. Cox
In March 2009 I wrote an article for Globalair.com that was Titled: ”The Not So Great Depression”,
you can re-read this by clicking on this link: https://blog.globalair.com/post/The-Not-So-Great-Depression.aspx
I wrote that piece whilst we were all living under the developing fall-out that was created as a
direct result of the Global Financial Crisis (GFC) that was first felt in the late summer of the previous
year, and was later proved to have started a full year before then (2007.)
The purpose of this article is to attempt to track just how far the Used Business Aircraft Market has
managed to pull itself away from the stinging clutches of GFC. I will use a statistical analysis process
that is fuelled by the numbers available to me through my subscription to AMSTAT. I will let you draw
your own conclusion as to where we currently stand overall, however it would be remiss of me if I didn’t
state that I believe that the Used Business Aircraft Market is on-track to achieve a soon to be issued
clean bill of health.
IT IS ALL IN THE NUMBERS, I.E. THE ‘PERCENTAGE FOR SALE’
November 2005 – Baseline
10,207 Turbo-Props, 1,127 or 11.04% were available for Sale
5,757 Light Jets, 833 or 14.47% were available for Sale
4,967 Medium Jets, 544 or 10.95% were available for Sale
3,180 Large Jets, 279 or 8.77% were available for Sale
November 2007 – Pre GFC Effect
11,121 Turbo-Props, 928 or 8.34% were available for Sale
6,417 Light Jets, 812 or 12.65% were available for Sale
5,757 Medium Jets, 584 or 10.14% were available for Sale
3,728 Large Jets, 267 or 7.16% were available for Sale
November 2009 – Within The Depths of GFC
12,049 Turbo-Props, 1,503 or 12.47% were available for Sale
7,285 Light Jets, 1,313 or 18.02% were available for Sale
6,568 Medium Jets, 1,098 or 16.72% were available for Sale
4,233 Large Jets, 597 or 14.10% were available for Sale
November 2011 – Emerging From GFC
12,616 Turbo-Props, 1,350 or 10.70% were available for Sale
7,615 Light Jets, 1,198 or 15.73% were available for Sale
6,826 Medium Jets, 924 or 13.54% were available for Sale
4,612 Large Jets, 554 or 12.01% were available for Sale
|
 |
|
SUMMARY GRAPH SHOWING HISTORICAL TO CURRENT PERCENTAGE FOR SALE
As you can see from the numbers and the associated Graph, the Percentage-for-sale ‘Peak’ came
approximately in 2009 (Light Jets peaked at 18% Mid 2009, while the rest all peaked in late 2009.)
We are about halfway back to normal therefore 2012/2013 are looking like they might be ‘rock-solid.’
THE TIME IT TAKES TO SELL IN TOUGH TIMES
How long does it take to sell an Aircraft? Statistically for the same Groups, one can track the Number of
Days On Market, i.e. the Average calendar time period in days from Initial Listing For Sale until Deal Closing.
The numbers are as follows:
November 2005 – Baseline
Average Days On Market for all Turbo-Props was 505
Average Days On Market for all Light Jets was 498
Average Days On Market for all Medium Jets was 436
Average Days On Market for all Large Jets was 447
November 2007 – Pre GFC Effect
Average Days On Market for all Turbo-Props was 492
Average Days On Market for all Light Jets was 517
Average Days On Market for all Medium Jets was 382
Average Days On Market for all Large Jets was 409
November 2009 – Within The Depths of GFC
Average Days On Market for all Turbo-Props was 420
Average Days On Market for all Light Jets was 471
Average Days On Market for all Medium Jets was 357
Average Days On Market for all Large Jets was 376
November 2011 – Emerging From GFC
Average Days On Market for all Turbo-Props was 553
Average Days On Market for all Light Jets was 588
Average Days On Market for all Medium Jets was 471
Average Days On Market for all Large Jets was 459
|
 |
|
SUMMARY GRAPH SHOWING AVERAGE DAYS ON MARKET
What is really interesting about this graph is the fact that when an Aircraft MUST be sold ASAP, it is
‘Right-Priced’ and sold in less time than normal. The Lowest number of Days occurred immediately after
GFC showed it despicable face to us all.
Now for the Same Aircraft Groups we shall focus on the Average Year of Manufacture for each Group:
AGE AFFECTS POPULARITY
November 2005 – Baseline
Average For-Sale Year of Manufacture for all Turbo-Props was 1982
Average For-Sale Year of Manufacture for all Light Jets was 1983
Average For-Sale Year of Manufacture for all Medium Jets was 1985
Average For-Sale Year of Manufacture for all Large Jets was 1982
November 2007 – Pre GFC Effect
Average For-Sale Year of Manufacture for all Turbo-Props was 1984
Average For-Sale Year of Manufacture for all Light Jets was 1985
Average For-Sale Year of Manufacture for all Medium Jets was 1988
Average For-Sale Year of Manufacture for all Large Jets was 1985
November 2009 – Within The Depths of GFC
Average For-Sale Year of Manufacture for all Turbo-Props was 1987
Average For-Sale Year of Manufacture for all Light Jets was 1989
Average For-Sale Year of Manufacture for all Medium Jets was 1992
Average For-Sale Year of Manufacture for all Large Jets was 1992
November 2011 – Emerging From GFC
Average For-Sale Year of Manufacture for all Turbo-Props is 1988
Average For-Sale Year of Manufacture for all Light Jets is 1990
Average For-Sale Year of Manufacture for all Medium Jets is 1992
|
|
|
AVERAGE AGES OF FOR SALE AIRCRAFT ARE GETTING YOUNGER, AS THE FLEET AGES
SPECIFIC MODELS
The following figures are quite enlightening as to the issue of Age and Obsolescence:
|
Year of Manufacture
|
1985
|
1981
|
1976
|
1978
|
1983
|
1979
|
| |
MU2 Solitare
|
Merlin IIIB
|
Learjet 25B
|
Sabreliner 75A
|
Challenger 600
|
Gulfstream II
|
| |
$1,375,000.00
|
$1,795,000.00
|
$1,297,500.00
|
$2,990,000.00
|
$9,000,000.00
|
$7,775,000.00
|
|
Year of Analysis
|
MU2 Solitare
|
Merlin IIIB
|
Learjet 25B
|
Sabreliner 75A
|
Challenger 600
|
Gulfstream II
|
|
Nov-05
|
$900,600.
|
$ 828,800.
|
$645,000.
|
$683,000.
|
$4,395,000.
|
$ 2,912,692.
|
|
Nov-06
|
$910,727.
|
$767,475.
|
$715,833.
|
$513,333.
|
$5,412,857.
|
$3,007,333.
|
|
Nov-07
|
$834,800.
|
$883,494.
|
$590,000.
|
$629,000.
|
$5,297,222.
|
$2,696,000.
|
|
Dec-08
|
$891,500.
|
$963,132.
|
$520,625.
|
$825,000.
|
$4,626,667.
|
$2,171,574.
|
|
Nov-09
|
$841,128.
|
$930,000.
|
$648,875.
|
$666,666.
|
$2,815,594.
|
$908,890.
|
|
Dec-10
|
$824,480.
|
$706,600.
|
$496,642.
|
$499,900.
|
$2,163,333.
|
$819,928.
|
|
Nov-11
|
$728,800.
|
$717,750.
|
$485,500.
|
$350,000.
|
$1,665,625.
|
$826,691.
|
OBSELETE AIRCRAFT (BASED UPON VALUES)
|
 |
|
Year of Manufacture
|
2002
|
2005
|
2003
|
2000
|
2001
|
1999
|
| |
Socata TBM700B
|
King Air 350
|
Cessna CJ1
|
Hawker 800XP
|
Challenger 604
|
Gulfstream V
|
| |
$2,512,390.
|
$5,881,474.
|
$4,024,000.
|
$11,895,000.
|
$23,235,000.
|
$39,100,000.
|
|
Year of Analysis
|
Socata TBM700B
|
King Air 350
|
Cessna CJ1
|
Hawker 800XP
|
Challenger 604
|
Gulfstream V
|
|
Nov-05
|
$2,071,153.
|
$2,651,666.
|
$3,554,500.
|
$10,208,000.
|
$18,500,000.
|
$36,573,333.
|
|
Nov-06
|
$1,905,833.
|
$3,658,333.
|
$3,374,500.
|
$9,768,000.
|
$18,700,000.
|
$33,950,000.
|
|
Nov-07
|
$1,850,000.
|
$4,211,923.
|
$3,610,000.
|
$9,158,214.
|
$22,315,000.
|
$45,000,000.
|
|
Dec-08
|
$1,859,875.
|
$3,633,947.
|
$3,552,222.
|
$8,918,700.
|
$20,675,000.
|
$38,683,333.
|
|
Nov-09
|
$1,685,556.
|
$3,594,565.
|
$2,944,750.
|
$5,852,250.
|
$13,140,455.
|
$25,185,714.
|
|
Dec-10
|
$1,634,989.
|
$2,941,500.
|
$2,641,500.
|
$4,610,313.
|
$13,289,000.
|
$26,247,500.
|
|
Nov-11
|
$1,587,857.
|
$3,034,211.
|
$2,299,087.
|
$4,080,909.
|
$11,356,250.
|
$26,400,000.
|
|
|
CURRENT OR NEAR CURRENT PRODUCTION AIRCRAFT
|
 |
|
With all that said I believe you can see that the market is progressing and should you be condsidering
the next step please review Globalair.com - Aircraft Exchange. Very current with aircraft, tools to use
such as A.Buyer and comparison tool. If you are thinking it you might want to use Globalair.com.
See you next Month!
|