| Narrowbody Dry Lease Rates (Dry) US$ '000s per month - February 2008 |
| Aircraft |
Age |
Rental |
Trend Analysis |
| B707-320CH |
1968-74
|
10-20
|
The easiest way to double the value of a B707 is seemingly to fill the fuel tanks! Lease rentals have failed to perform any better such that they remain at very low levels. Power-by-the-hour agreements are much more likely for such vintage aircraft such that maintenance costs are also covered. Once the Queen of the Skies but now earthbound. |
| B727-100H |
1967-71
|
15-25
|
The market for the hushed is very subdued not least because of the limited number in service. Rates are barely impacted by external forces. |
| B727-200H |
1969-71
|
15-30
|
The time for the -200H has long since passed such that the hushkit seems a very expensive option. |
| B727-200HADV |
1975-79
|
30-50
|
The market for the -200HADV remains despite age, efficiency and flight crew costs. In the absence of readily available alternatives, there are a number of carriers who have little option but to carry on operating the type. With the variation in the financial standing of the lessee, the term and the aircraft, there can be a range of appropriate rentals. Reliability remains a key issue for those seeking to maintain a high level of utilization. |
| B737-200H |
1968
|
-
|
The -200 has no relevance in the leasing market. |
| B737-200HADV |
1978-84
|
30-60
|
The number of -200HADVs remaining in service always comes as something of a surprise in view of the large number of replacements now available. Lease rentals can range by a considerable amount due to the differences in terms. The rates must however, be seen in the context of changing market conditions which is seeing ever decreasing interest in the type. |
| BAe146-200 |
1984-88
|
40-60
|
The age profile of the BAe146 now stretches back for nearly 25 years. Contemporary types such as the MD80 have been facing problems for many years which contrasts with the more steady performance of the -200. The type still has considerable merit as illustrated by those aircraft that remain in service with prime operators. The move to the RJ is however, a negative. |
| BAe146-300 |
1988-92
|
45-75
|
The larger capacity of the -300 offers more attractive seat mile costs particularly for those operators experiencing greater traffic. Compared to modern regional jets the -300 represents a bargain. However, the market is changing and the appetite for the type is not what it once was. |
| BAC1-11-400 |
1970
|
15-30
|
The BAC1-11-400 can virtually be leased for small change though maintenance reserves will likely require slightly more investment. |
| F28-4000 |
1977
|
15-25
|
The price of the F28-4000 is such that it now equates to the price of a house in Western Europe making a vanilla operating lease less appealing. |
| Fokker 100 |
1988-93
|
40-60
|
Hard work amongst the owners of the Fokker 100 has enabled lease rentals to register an improvement. Though finding willing lessees is still not easy despite the strength of the market, the type is experiencing better fortunes than those of a few years ago. There should yet be some opportunity for stability in rentals. |
| Fokker 70 |
1994-96
|
40-50
|
The number of Fokker 70s in service is limited but the appetite for the variant remains very fragile. There exist a number of rivals featuring better operating economics such that demand for the Fokker 70 stems from availability and price. |
| DC9-30H |
1968-75
|
20-30
|
There continues to be some demand for the DC9-30H but this remains limited. Lease rates can exhibit considerable variation but the overall trend remains depressing. |
| B737-300 |
1985-89 1990-95
|
90-130 110-160
|
The market for the B737-300 continues to remain reasonably resilient. The inability of the manufacturers to build aircraft fast enough to meet demand combined with the sustained growth of the market means that operators have little option but to continue to use the B737-300. The preference is clearly for those in better condition. Rentals in excess of $160,000 per month would seem to be exceptional and rare. The number on the market has been steady at around 30 for nearly a year though this still represents a small proportion of the fleet. Lessors simply do not have to advertize. |
| B737-400 |
1989-93
|
105-165
|
The demand for the -400 is strong even though performance characteristics are somewhat compromised. A great many operators do not require absolute range nor seek to push payload/range envelopes. As a result lease rentals remain strong though as newer aircraft types deliver in number, some weakness is expected to appear in the short term. Only a single unit is currently being advertised for sale or lease demonstrating how quickly aircraft can be placed. |
| B737-500 |
1991-96
|
90-145
|
The demand for the -500 continues to be consistent although in contrast to the -400 availability is slightly higher. The demand from operators in Eastern Europe and Russia is notable and this is helping to keep lease rentals at current levels. With the expansion of this market segment, there may yet be further demand. |
| MD82 |
1982-89
|
40-75
|
The MD80 series continues to experience considerable difficulties in terms of relative attraction. The type has failed to take advantage of the demand for capacity and lease rentals, therefore, remain in a backwater. Power-by-the-hour arrangements may generate more revenue than straight leasing. The number being advertized are less than 10 but this obscures the fact that some are simply not being advertised. |
| MD83 |
1986-93
|
50-90
|
Expectations of rentals topping $100,000 remain just as much a forlorn hope as it did 18 months ago. The type may have better performance than other MD80 examples but, with so many more leased, the competition to place aircraft is that much more intense. There are now some 30 being advertised for sale or lease, a figure which is rising rather than falling. Rentals may be higher only because of leases to weaker credits on shorter terms. |
| Commentary reflects change over the previous three months. |
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