The pre-owned aircraft market as seen by Altair

Alasdair Whyte
By Alasdair Whyte May 17, 2011 09:58
Altair’s Jean Sémiramoth assesses the state of the pre-owned business aircraft market.

Until the end of last year, the industry expected aircraft sales to be driven by the Middle East and Asia.  There was no reason to think that this trend would change, until a series of major catastrophes hit these regions, namely; the earthquake, tsunami and nuclear disaster in Japan; the political unrest in the Middle East region, affecting countries including Bahrain, Syria, Yemen, Egypt, Libya, Jordan, Algeria and Tunisia.


Uncertainties

The sudden and serious changes in these regions make the future for these areas uncertain and market updates, forecasts and predictions for the aviation industry very difficult to make with
any accuracy.

That said, it is likely that every sector of the aviation industry will be affected to some degree or another, but at this stage it is too soon to be able to predict the extent of these effects or how long they will be felt for.


Threats

Following the disasters in Japan, several sources have told us that they have had to turn down transactions and this trend is expected to continue as the country deals with the aftermath of the earthquake and tsunami.

In North Africa and the Middle East we are seeing many projects being postponed across all aircraft types; including the large business jets and the bizliners.  Furthermore, one can expect that some owners and operators in the region will start selling off their aircraft.

China, on the other hand, is booming with a strong economy and finance available.  But even this bastion of light for the industry is not necessarily all good news for the pre-owned sector as laws within the country make it very difficult to import second hand aircraft.  So the market in China is almost exclusively focused on new aircraft.


Business jet market

The upper segment of the market is made up of large business jets such as the likes of Bombardier Global Express, the Gulfstream and the Dassault Falcon. Above even this category is the bizliners from Boeing and Airbus.

To date, the market for the latter has predominantly been the Middle East. So we all wait with some kind of baited breath to see what effect the unrest in this region will have on the manufacturers of these types of jets. But we certainly expect to see some challenges in the region as the year progresses.

Alasdair Whyte
By Alasdair Whyte May 17, 2011 09:58

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