UBS: Used Bizjet Inventory Falls after 18-month Rise

By: Chad Trautvetter

July 2, 2009
Business Aviation

The pre-owned business jet market appears to have bottomed out last month, according to UBS Investment Research’s latest business jet update, released this morning. “Available business jet inventories stepped down 2 percent in June after sequential increases in each of the prior 18 months,” UBS aerospace and aviation analyst David Strauss noted in the report.

The investment firm regards the used business jet market as a leading indicator of the new business jet market. However, pre-owned inventories are still 48 percent higher than this time last year and represent 17 percent of the in-service fleet, meaning recovery of the industry will take some time.

UBS data shows that pre-owned inventories of young aircraft (less than 10 years old) slid 3 percent last month, which is their second consecutive decline but still roughly double prior-year levels. New delivery position inventories fell 10 percent last month, the third straight sequential decline, UBS said.

“We estimate average asking prices for most young aircraft models have now fallen 30 to 40 percent from peak levels, with pricing down another 3 to 4 percent in the past month,” Strauss said. “We think record high used available inventories will continue to overhang orders, pressure existing backlogs and force further production cuts.

Back

Bizjet Market Continues Improvement, JPMorgan Says November 05, 2009 JPMorgan’s latest business jet monthly report, released yesterday, indicates that October was another month of modest improvement in aircraft... [more]
GAMA 3Q Numbers Show Deliveries, Billings Down November 05, 2009 Airplane shipment numbers released today by the General Aviation Manufacturers Association (GAMA) starkly demonstrate the effect the economic... [more]
NBAA Convention Report 2009 November 02, 2009 For Cessna Mustang owner Jeff Greenberg, NBAA’s 62nd Annual Meeting & Convention just wasn’t long enough. Attracted to the event held last month... [more]
Donnelly succeeds Campbell as Textron CEO next month November 01, 2009 Cessna and Bell parent company Textron has tapped company president and COO Scott Donnelly to replace retiring Lewis Campbell as CEO, effective... [more]
Pelton: Bizav Issues Don’t End at Borders November 01, 2009 Business aviation faces similar issues around the world that will require operators to cooperate across regional lines if the industry is to... [more]