Aircraft
Values Neutralize After Descent
Carl Janssens, ASA | Aircraft
Bluebook–Price Digest
[View
the charts.]
Aircraft values reported in the previous quarter
were in a spiral dive, but the economy’s pilot now appears to have
neutralized the rapid descent.
For the most part, values have
arrived at ground level. Inventories have shown signs of stability with
little or no growth in units for sale. Other market indicators show
signs of neutralization as well. Aircraft dealers and brokers report
that interest has increased. Phones are ringing more with potential
buyers on the line. Compared to the 2005 baseline real gross domestic
product, GDP declined 1.0 percent in the second quarter of 2009 after
declining 6.4 percent in the first quarter. These indicators support the
signs of neutralization in the marketplace, though the used aircraft
market has no reason to rally.
Maybe the market has not yet
reached the dawn of a recovery, but the market has absorbed the fallen
values. The jet segment is the most volatile portion of the aircraft
market. Flight departments that were liquidated are no longer creating a
frenzy of drastic value reductions. Manufacturers finding new homes for
new aircraft in default maintain nearly full sales values. The only
difference is that deposits from contracts in default allow discounts to
the new buyers. Once these sales are complete, the discounts will
end.
Read more 
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