JETNET releases December and Year End results

According to JETNET, the pre-owned business aircraft inventories continued to decline in December, but asking prices-especially for jets-are still dropping.

Business jet inventory in December stood at 13.8% of the in-service fleet, down 1.0% from a year ago. For the year 2011, jet sale transactions increased by 7.0% compared to the same period the previous year. However, average asking price
fell 13.8% to $4.64 million in the same time frame, and average days on the market swelled by 20 days to 383.

The turboprop market appears to be gaining a better footing. Inventory of pre owned turboprops settled at 9.6% in December, down from 10.6% the previous year. Turboprop sale transactions rose by 13.4% in 2011 compared with the same period the previous year, while the number of days on market decreased by six days to 331. Average Asking price was the only negative in the turboprop segment, though it fell by only 3.5% to $1.309 million versus a year ago.

JETNET  says that for turbine and piston helicopter full sale transactions have declined by double-digit percentages, 11.9% and 17.7% respectively, in 2011 versus 2010. The percentages of the turbine and piston helicopter fleets For
Sale in December 2011 were both below 7%. $1 million separates the average asking prices for turbine helicopters and oiston helicopters, at $1.29 million and $226,000 respectively. While the average asking price for turbine helicopters is declining, the piston helicopter average asking price has increased by 9.3%. This is the only pre-owned market sector to show an increase in average asking price, as highlighted in Table A along with other key worldwide trends.

The company says real gross domestic product (GDP)-the output of goods and services produced by labor and property located in the United States-increased at an annual rate of 2.8% in the 4th quarter of 2011 (that is, from the 3rd quarter to the 4th quarter), according to the “advance” estimate released by the Bureau of Economic Analysis (BEA). In the 3rd quarter, real GDP increased 1.8%.

A GDP percentage change of 3% or more is always positive for business aviation. While the rate of 2.8% in the 4th quarter is below 3.0%, it provides some positive news as the 4th quarter 2011 and yearend numbers are being reported.

Table A

JETNET says that the end of 2011 marks over three years since the economic downturn in late 2008. Expectations are cautiously positive for 2012, but with a warning label to “open with care” as there is still a strong need
for both business and consumer confidence to improve.