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Monday, February 18, 2008
No Trend for RJs, Beech 1900D Suffers
There is no clear cut trend line in evidence for the 50 seaters, according to RAN’s sister publication Aircraft Value News, which published valuations for all breeds of regional aircraft in its latest issue. Related Story Production has all but ended, demonstrating that the market has moved on and upwards while at the same time there remains sufficient interest in the type to keep availability at low levels.
Despite the demand for the 50 seaters, values are beginning to reflect out-of-production status. The youngest aircraft are usually the most vulnerable to declines in values owing to the limited differentiation in terms of specification between the oldest and newest as well as lesser difference in terms of maintenance status. Operators are not willing to pay a substantial premium for a newer aircraft if it performs the same as one which is five or more years older.
Values of the larger, more modern regional jets, remain firm. This sector has traditionally been dependent on manufacturers taking a more significant risk in developing the type and then waiting for larger scale orders to emerge once full production has started. This contrasts with the experience of Airbus and Boeing whereby they are able to depend more on a number of launch customers.
Economics of Beech 1900D Fail to Prevent Demise
Values of the Beech 1900D, already under pressure owing to increased enthusiasm for larger equipment, are experiencing further problems as the U.S. economy takes it toll on short-haul flights.
A number of Beech 1900D operators have been forced to pull the plug on operations. Mesa Air Group has needed to dissolve Air Midwest, an operator with some 20 Beech 1900Ds remaining in its fleet. Colgan Air operates 10 Beech 1900Ds and intends to retire the type by the end of this year. Midwest Airlines is also closing down Skyway Airlines, an operator of 10 Beech 1900Ds as well as 12 328JETs. Related Story
In a period of high fuel prices, the turboprops should be enjoying renewed demand. Production of the Beech 1900D only ceased in the last few years making it the last 19 seater to be built. Values of the Beech 1900D and other 19 seaters have in any case been under pressure as a result of operators seeking larger equipment to make better use of resources. More recently, the faltering U.S. economy has reduced both disposable income as well as business travel from destinations served by the smaller aircraft types. In addition, fares from such destination are generally higher. Combined with the high price of fuel, the smaller aircraft have become increasingly uneconomic. There have always seemed to be a high number of Beech 1900D aircraft on the market at any one time but recent announcements make it increasingly difficult to allow values to remain at current levels.
The type may have a role in the freight sector but in view of the number being released in the coming months, demand from this source will be insufficient to prevent a surplus.
Despite the demand for the 50 seaters, values are beginning to reflect out-of-production status. The youngest aircraft are usually the most vulnerable to declines in values owing to the limited differentiation in terms of specification between the oldest and newest as well as lesser difference in terms of maintenance status. Operators are not willing to pay a substantial premium for a newer aircraft if it performs the same as one which is five or more years older.
Values of the larger, more modern regional jets, remain firm. This sector has traditionally been dependent on manufacturers taking a more significant risk in developing the type and then waiting for larger scale orders to emerge once full production has started. This contrasts with the experience of Airbus and Boeing whereby they are able to depend more on a number of launch customers.
Economics of Beech 1900D Fail to Prevent Demise
Values of the Beech 1900D, already under pressure owing to increased enthusiasm for larger equipment, are experiencing further problems as the U.S. economy takes it toll on short-haul flights.
A number of Beech 1900D operators have been forced to pull the plug on operations. Mesa Air Group has needed to dissolve Air Midwest, an operator with some 20 Beech 1900Ds remaining in its fleet. Colgan Air operates 10 Beech 1900Ds and intends to retire the type by the end of this year. Midwest Airlines is also closing down Skyway Airlines, an operator of 10 Beech 1900Ds as well as 12 328JETs. Related Story
In a period of high fuel prices, the turboprops should be enjoying renewed demand. Production of the Beech 1900D only ceased in the last few years making it the last 19 seater to be built. Values of the Beech 1900D and other 19 seaters have in any case been under pressure as a result of operators seeking larger equipment to make better use of resources. More recently, the faltering U.S. economy has reduced both disposable income as well as business travel from destinations served by the smaller aircraft types. In addition, fares from such destination are generally higher. Combined with the high price of fuel, the smaller aircraft have become increasingly uneconomic. There have always seemed to be a high number of Beech 1900D aircraft on the market at any one time but recent announcements make it increasingly difficult to allow values to remain at current levels.
The type may have a role in the freight sector but in view of the number being released in the coming months, demand from this source will be insufficient to prevent a surplus.

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