High Quality Aircraft Expected to Weather the COVID-19 Pandemic Significantly Better than Aging, Low Quality Aircraft
April 16, 2020 – While most aircraft transaction values reflected in the Q1 2020 AI2 Market Report were established prior to the full impact of the COVID-19 pandemic, demand was down 13% across the for-sale fleet of pre-owned aircraft, with the decrease impacting all market segments. Quality of the for-sale inventory improved slightly across all market segments. Asset Insight added several aircraft models to the company’s tracking system in 2020, and the March 31, 2020 report covers 134 fixed-wing models and 2,218 aircraft listed for sale.
Indicators were mixed depending upon the market segment for Q1 2020. Expectations of buyers and sellers were more in line regarding asking and actual transaction prices for Large Jets and Turboprops. However, the asking v. transaction price gap widened for Medium and Small Jets. Tracking with a decrease in demand, for-sale aircraft also tended to spend more time on the market in Q1 2020 after an improvement in Q4 2019.
“While we are currently in an unprecedented time globally, we’re still seeing aircraft transactions and no storm lasts forever.” said Tony Kioussis, president of Asset Insight, LLC. “Aircraft whose ETP Ratio (Maintenance Exposure v. Ask Price) was 40% or higher spent 68% longer on the market than aircraft whose ETP Ratio was below 40% (246 v 413 days on the market). And, while we remain optimistic about the post-pandemic market, we are expecting prices to continue to fall in Q2, and for Large and Small Jets, the price fall will accelerate significantly.”
Note to editors, managers and owners: Please see the bottom right corner of each category page for a concise summary of the results and conditions in that specific market segment.
Exclusively available from Asset Insight, the AI2 Market Report includes eTrendTM, a 90-day forecast for aircraft value by make and model. This tool is especially helpful to sellers who are evaluating offers on their aircraft while concurrently considering if their prospects are likely to improve.
Statistically, Asset Insight’s eTrendTM forecasts are based on some of the most robust data analytics in the industry and have been thoroughly back-tested to confirm a significant degree of accuracy.
