Tue, May 08, 2012
Analyst Brian Foley Says 'Significant Attrition' Not Surprising
"I wouldn't exactly call it a disappearing act," says general aviation analyst Brian Foley (pictured). "But it's been a significant attrition and not altogether surprising in view of Europe's economic woes. At this rate it may be another year before Europe's fleet can grow again."
Over the last 12 months some 50 European business jets, or roughly 2% of the continent's population, have been sold into other continents whose fleets have grown an overall 3%. A commanding 79% of them have found new homes in North America, mostly in the United States and Canada. The rest have gone to Africa (7%), Australia (5%) South America (5%) and Asia (4%).
Today's for-sale statistics do not bode well for a prompt recovery. Almost one European business jet in five (19%) is up for sale, which is more than one-third higher than the worldwide average of 14%. Of those exported, their average age of 12 years matches the overall European fleet age exactly, which means that the aircraft being sold are a representative mix of everything in the fleet from old clunkers to the newest, most fuel-efficient models. Foley's hypothesis is that the world's pre-owned jet buyers have been shopping in Europe where the high supply keeps prices down. Another factor is Europe's lowering Euro, which favors outside buyers. "This underscores the seriousness of Europe's crisis," Foley says. "Europe may be the last bastion of great pre-owned airplane deals as owners must sell in this austere climate."
Most pundits think that Europe's new-aircraft sales recovery will lag until its pre-owned inventory diminishes, but Foley disagrees. "There is no cause-and-effect relationship because, generally speaking, new and pre-owned buyers are totally different groups. Our experience shows that those who buy new will almost invariably continue buying new in order to get the latest model that is truly personalized to their requirements and not 'tainted' by the tastes of a previous owner. Conversely, pre-owned buyers tend to be more value-driven, flexible and receptive to the immediate-availability advantage of buying pre-owned. With a sufficiently improving economy, both types of buyers will return; that's my thesis. A declining pre-owned inventory will not cause new-aircraft sales to surge but can presage their recovery."
Will Offer Significant Performance Boost For Sonex Aircraft Sonex Aircraft announced at a press and customer briefing Sunday morning that orders are now being accepted for the long>[...]
MVP.Aero Introduces What It Calls The Worlds 'Most Versatile Plane' A new sport plane that is designed to operate from runways, water, and snow and ice was introduced Sunday aftern>[...]
OSH2014 Sponsor: Bendix-King by Honeywell The history of the Bendix name runs parallel to the development of King Radio until the mid-1980s, when the Allied Corporation purchased B>[...]
Aviation Modifications Leaders -- Unique Solutions For Critical Applications During two decades of designing, engineering and installation of Satcom systems with Honeywell (Allied >[...]
LONG-TIME ANN Sponsor, ForeFlight, Provides GREAT Guidance For Oshkosh 2014! ForeFlight was founded in 2007 by aviation entrepreneurs who set out to build elegant, high-performing >[...]