Online charter portal Avinode’s forward-looking demand index stood at 97.13 on November 7, more than 45 points lower than on October 7. Nonetheless, the current index is still three points above where it stood 12 months ago. Avinode’s price index for the next 30 days doesn’t paint such a clear picture of decline.
A few years ago at the NBAA show we witnessed more than 1,000 Dow points melt away during the three-day convention. That was the beginning of the biggest downward trend that corporate jet sales had ever experienced, and the remnants of the price carnage that ensued are still with us.
At approximately 3:30 p.m. today, executives from Shell Aviation will present a $5,000 donation check to the Corporate Angel Network (CAN) at Booth No. C10235. The amount represents the value of points donated by members of Shell’s AeroClass pilot loyalty program over the past year.
While the pre-owned market has had to grind it out over the last couple of years to turn a deal, buyers have made a considerable dent in the number of choices since then, with 500 fewer aircraft available compared with the number of choices at the peak. As the industry heads into what is typically one of the most active periods of the year, the trend should continue.
Demand for charter flights anticipated during August showed a marked trailing off compared with a strong showing for July, according to the latest data from online charter portal Avinode. On August 1, the company’s forward-looking demand index stood at 128.88, almost 27 points down on July 1, but just over 30 points higher than it had been 12 months earlier on Aug. 1, 2010.
Business aircraft sales firm Jetcraft is “seeing clear evidence” of a return to a more stable pricing environment for large-cabin, long-range business jets. “There has been a significant reduction in the gap between buyer and seller price expectations, due in part to the reduction of distressed assets that flooded the market in late 2008,” noted company co-owner Jahid Fazal-Karim.
The current pre-owned aircraft market can be defined as consistent as inventory continues to inch down, month-after-month. Many people regard this consistency to be welcome news, considering where the market was a couple of years ago.
There is “uneven progress” toward recovery, JPMorgan said in its latest business jet market update.
Before the financial crisis in the days of the money-no-object approach to business aviation, the attitude of some FBOs when asked what handling services would cost was a rather snooty, “If you need to ask the price, it’s probably not for you, sir.” Preposterously inflated prices and widespread inconsistency and lack of transparency were all too common in the industry.
Attractive pricing persists on many popular models despite a continued tightening of inventory to its lowest level since peaking less than two years ago.