JETNET releases December 2012 and full year 2012 data

JETNET has released December 2012 monthly and year-to-date (YTD) results for the pre-owned business jet, business turboprop and helicopter markets.

Highlighted in the Table A market summary are key worldwide trends across all pre-owned aircraft market sectors, comparing December 2012 to December 2011, as well as YTD. The Fleet For Sale percentages for all market sectors, except for piston helicopters which showed no change, were down in the December comparisons, with the largest drop in business turboprops, to 8.3% from 9.6% in December 2011.

Key Metrics (December 2012 vs. December 2011 and YTD)

For Sale inventories continue to decline:

• •Business jets for sale were at 13.4% (down 0.4 from 13.8%)
• Business turboprops for sale were at 8.3% (down 1.3 from 9.6%)
• Turbine helicopters for sale were at 6.1% (down 0.5 from 6.6%)
• Piston helicopters for sale were at 6.1% (no change)

Full Sale Transactions had mixed results, with only business jets showing growth:

• •Business jets were up (7.2%)
• •Business turboprops were down (-5.7%)
• •Both turbine (-1.2%) and piston (-6.1%) helicopters were down

Average Days on Market are all at very high levels:

• All market sectors have shown increases in average days on market YTD through December 2012, except business jets, which took 10 fewer days
• Piston helicopters took more than a month (37 days) longer to sell than a year ago

Average Asking Prices had mixed results:

• Business turboprops (+2.6%) and turbine helicopters (+7.3%) increased
• • Business jets (-0.3%) and piston helicopters (-0.9%) decreased

Pre-owned Business Jet “For Sale” Market

Several significant events have occurred since 2005 in the Business Jet “For Sale” inventory:

• In the past 8 years the market has remained a buyer’s market, based on 10% or greater fleet percentage of the in-operation business jets for sale
• After several years of record sales and rising aircraft values, the bubble finally burst in 2008 amid a world economic collapse and banking crisis of historic proportion. From 2007, there was a large increase of 973 (or 60%) in 2008 and 1,147 (or 70%) in 2009 of business jets in the “For Sale” inventory. This increase peaked in 2009, as shown in Chart A
• The year-end “For Sale” inventory decline starting in 2010 has remained relatively unchanged over the past three years. The percentage for sale has declined more as a result of the growth of the inoperation fleet numbers, increasing from 17,118 in 2009 to 18,897 in 2012. The year-ending 2012 “For Sale” inventory level is 2,539, or 13.4%

Pre-owned Business Jet Market Full Retail Sale Transactions

GOOD NEWS! 2012 has set a new record for the number of Pre-owned Full Retail Sale Transactions. Chart B shows 2,240 transactions in 2012, beating the previous record peak of 2,181 in 2007. This record follows three years of increases from the low of 1,539 transactions recorded in 2009.

However, other pre-owned market sectors are not showing similar results. They are showing decreasing sale transactions, are taking longer to sell on average, and have mixed average asking prices, with some greater and some less compared to the same 2011 period.

Significant is the 7.3% increase in turbine helicopter average asking price. While price increases are evident across the board for all models in this segment in 2012, there were also several very-highasking- price models that sold. These models had asking prices exceedingly higher than those of the typical helicopter on the market.

Pre-owned Business Jet Market By Weight Class

As shown in Table B, the medium weight class was the only weight class to show a decline, with 17 (or 3%) fewer business jet transactions in a comparison of 2012 to 2011. The other classes all showed increases, led by the heavy class with 85 (or 15%), followed closely by the light class with 76 (or 9%) more pre-owned business jet transactions in 2012 compared to 2011.

Summary

2012 was a success for our industry in many ways, and the pre-owned market continues to be very active. Now that 2013 is here and there is renewed optimism, it is hoped this trend for the pre-owned market, along with improvements in the world economy, will continue to push more new aircraft purchases for the new year. For now, it continues to be a buyer’s market, with Pre-Owned For Sale inventories running around 13%.