Market Update - October 2018

Spencer Bain and Mark Egan, Lone Mountain Aircraft Sales

While the fourth quarter traditionally brings the most activity in terms of preflown aircraft transactions, we witnessed a colossal absorption of late-model inventory in the first quarter of 2018. The result as we head into Q4 has been a bifurcation of many aircraft models, meaning most aircraft on the market are either like-new or on the other end of the spectrum – well outside manufacturer’s warranty and possibly near a major maintenance event.

This means clear skies and improving pricing for sellers inside that void as buyers seek planes that aren’t new, but not too old; that have a few blemishes, but aren’t in need of a new interior; that have time on the engine(s), but aren’t near overhaul. These buyers are having a much harder time finding a plane that is “just right” for their trips skyward.

Jet Market: We are seeing the lowest percentage (9.1) of the business jet fleet for sale in this century – since 1998 in fact. Light jets are the strongest segment with 10.7 percent of the total fleet available for sale. The newer segment within that fleet (less than 10 years old) represents only 5.6 percent for sale today. Ask prices within that segment are up – that’s right, up – 4.8 percent year-to-date.

Turboprop Market: The turboprop market currently has 7.2 percent of the fleet for sale. This represents the lowest percentage in the category’s history. The asking price for newer aircraft is up 11.1 percent year-to-date. Mid-age turbos (11-20 years) have an average asking price up 4.4 percent. Waning years, however, are still seeing a pricing slide.

Cirrus Market: Similar to this time last year, Cirrus Aircraft is experiencing their longest backlog of new aircraft, now taking orders for mid-year 2019 with the exception of a few remaining factory demonstrator aircraft available. This, along with the current market premium for all pre-owned G6 aircraft, supports the popularity of the G6 aircraft with Nxi Avionics.

Market ReportsPre-owned Cirrus inventory has consistently been down since the beginning of the year by almost 13 percent compared to the average in the last five years. This has not slowed down sales, with the total number of transactions 11 percent higher than at this time in 2017. We are also pleased to report that average sales prices are up just over 6 percent since this time in 2017. With those data points in mind as we head into what has historically been the strongest quarter of the year, makes for a great time to consider planning your upgrade to your next airplane.

As always, don’t hesitate to contact our team at Lone Mountain for a more in-depth market analysis. To be added to our TBM, Meridian or Phenom 100 quarterly reports, email your name and address to info@lonemtn.com.