Aging Inventory Driving Prices Down, Widening Buyer and Seller Value Expectations and Lowering Asset Quality
Overall Demand Increase Slightly
April 18, 2019 – According to Asset Insight’s Q1 2019 Market Report (AI2 Market Report), demand across the inventory pool remained unchanged. However, the limited number of younger aircraft traded aggressively. The larger number of older aircraft drove average prices down, lowered the overall asset quality of the for-sale fleet and evidenced a widening gap between the value expectations of buyers and sellers.
The 1Q 2019 AI2 Market Report analyzes values for every production year of every modern make and model Business Class aircraft, while the Report’s maintenance analytics cover 96 fixed-wing models and 1,656 aircraft listed for sale.
Other trends detailed in the 1Q 2019 Market Report include:
- Trends for Ask Prices & Demand were mixed across aircraft groups:
- Ask Prices were down 5% overall, but increased for Medium and Small Jets
- Demand increased slightly overall; specifically, demand was up for Large and Medium Jets, and Down for Small Jets and Turboprops
- The larger inventory of older aircraft drove market indicators:
- Ask Prices declined overall due to older for-sale aircraft
- Inventory fleet quality declined overall
- Maintenance Exposure worsened for most groups
ETP Ratio worsened slightly
- Q2 2019 Forecast is for continued decrease in Ask Prices across all aircraft groups
“Newer aircraft continue to sell quickly and for solid prices, but there are fewer and fewer of those low-time, high-quality aircraft available on the market” said Tony Kioussis, president of Asset Insight, LLC. “Buyers could see real opportunities in Q2 for older, higher-time aircraft, as we expect prices to continue to decline across all market segments.”
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.
