Monday, July 21, 2008
ExecuJet Reports Boom in Pre-owned Aircraft
Pre-owned demand is being led primarily by the Middle East which is growing by 20 percent each year and also in India, and China, where ExecuJet recently opened offices in Mumbai and Beijing.
Last year, the Middle East market accounted for $300 million of pre-owned aircraft sales, comprising over a dozen transactions and representing nearly 50 percent of ExecuJet’s total transactions during 2007. “On the back of these transactions ExecuJet Middle East has gained seven new aircraft under management, which have since joined the fleet,” says Nicholas McHaffey. Currently, ExecuJet Middle East is receiving one new inquiry every week with demand largely focused on wide-bodied cabin aircraft.
ROW Expands as US Dips
The US business aircraft market is pretty much saturated now, ExecuJet asserts. “Five years ago this would have a massive effect on aircraft values and perceptions worldwide, but that was when 70 percent of all business aircraft transactions were US based,” said Executive Director, Group Sales, Andrew Hoy, who will head up the new division as Head of Global Pre-Owned Sales. “Today we are competing in a global market – and we have seen the US market dip to just 40-45 percent of all transactions.”
“The new emerging regions such as the Middle East, India and the Far East are driving the pre- owned market,” adds McHaffey. “Consider the massive lead times on new-built aircraft (Year 2011 for a new Learjet; first quarter 2012 for a new Challenger 605) and it makes sense to look to the pre-owned market.”
Recent ExecuJet transactions have seen a 2006 Challenger 604 sell for $2 million more than its original price and, last month, ExecuJet placed a 2005 Challenger 300 for $2 million more than its original price tag owing to the demand for the quality aircraft provided within the ExecuJet inventory. Even now, customers are placing multiple orders, to meet their future needs, with some prospects in the ME and Asia booking aircraft as late as 2013, McHaffey reported.