Market Report: Decreasing Supply,
Stable Pricing, Promising Prospects
By Bruce Byerly
Turbine aircraft buyers continue to enjoy a buyer�s markets, with ample supply and aggressive prices. Some markets are stronger than others, but it�s no surprise that the sluggish economy generally means a reduced level of demand across the board. However, while discount pricing for used jets continues to attract buyers, value guide Vref reports stable pricing for turboprops, including the Commander market, over the last quarter.
Common to the majority of turbine markets, the supply of Commander Jetprops continues a decreasing trend. According to popular market information provider Jetnet, the number of available Commanders (690 through 1000 models) has steadily decreased, both over the last quarter and year-to-date.
In a strong economy we would expect rising prices, however prices continue to be lower than might be expected, especially with a decreasing supply. So, buyers continue to enjoy good deals on quality aircraft, including Commanders.
Although the number of available Commander Jetprops is fewer than 10 percent of the fleet -- a benchmark often regarded in the industry as the point separating �buyers� and �sellers� markets, prices have yet to follow.
Since 2008 the inventory of Commander aircraft for sale has decreased on average every year and currently stands at 56, the lowest number in recent memory. In fact, not since 1998 have we seen comparable inventory levels for Commanders. Why? One clear factor is that worldwide demand has increased relative to domestic demand. Small businesses from South Africa, Brazil, Venezuela, Canada, and most recently Germany continue to purchase some of the best aircraft on the FAA registry and put them to work.
Both in the U.S. and abroad, updates in cockpit technology and a quality maintenance history are more important than ever at the time of sale. An increasing number of buyers demand glass-panel updates. Who imagined the day a Garmin 530 was considered a good candidate for replacement? Buyers will either choose an aircraft with a contemporary panel, or account for an extensive retrofit when it comes time to write the check. Quality maintenance and complete service bulletin compliance are even more important to educated buyers.
Operators interested in efficient transportation will support the current trend toward stability in the legacy turboprop markets. This is especially true for the fuel-efficient Commander lineup, which compares favorably to any other legacy or new turboprop. The fuel-efficiency advantage is one that legacy jets can never claim, and the long-term prospects for cabin-class piston twins and the 100LL they consume is clouded. All of that bodes well for the Commander market, both buyers and sellers.
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