The business aircraft resale market continues to stall as the sluggish pace of activity seen in Q2 2013 has persisted, according to Amstat’s Business Aviation Market Update Report, released on the eve of NBAA 2013.
“We were disappointed with the Q2 transaction performance and were hoping for a better Q3,” said Andrew Young, general manager of the business aviation market data provider. “In general, transaction activity for business jets and turboprops did pick up in Q3 and inventories were down–both good signs. However, this performance is not consistent across all fixed-wing segments.”
Among the observations presented by the Tinton Falls, New Jersey-based company (Booth No. C10016) here this week are:
•Business jet retail resale transactions were up from 2.3 percent of the active fleet in Q2 of this year to 2.6 percent in Q3, but still below the 20-year average of 2.9 percent.
•Heavy and light jets performed the best in Q3 as they did the previous quarter. Heavy jets, with 2.2 percent of the active fleet selling in Q3, were close to their 20-year average of 2.3 percent, a substantial improvement from the 1.8 percent and 1.9 percent turnover the category saw in Q2 and Q3 respectively in 2012.
•3.2 percent of the light jet fleet turned over in Q3 of this year, up from 2.5 percent in the previous quarter, while resales of mid-size jets declined to 2.1 percent of the fleet in Q3 versus 2.4 percent in Q2.
•The inventory of mid-size jets continues to rise, which Amstat called “of particular concern,” given the category’s poor resale performance.
•Turboprop resale activity has seen little change over the past year, registering 2.2 percent in Q2 and 2.1 percent in Q3. (In Q3 of 2012, 2.2 percent of the turboprop fleet changed hands.)
•Inventory of used turbine helicopters is rising, with 6.5 percent of the fleet for sale in Q3 versus 6.1 percent in Q2. (In Q3 2012, 6 percent of the turbine rotor fleet was on the market.) “We look to see improved transaction activity and lower inventories in the [turbine helicopter] market in the future,” Young said.
Average asking prices for jets and turboprops were either flat or down in Q3 versus Q2, according to Amstat. However, Young noted “Q3 is frequently the slowest quarter each year for resale market transaction activity while Q4 is frequently the best quarter for transaction activity. Let’s hope.” –J.W.