Market Insights 2.qxp_MARKET INSIGHTS 21/12/2021 10:09 Page 1
MARKET INSIGHTS
An Update on the Business Aviation Market, Q4 2021 How was the used business aircraft sales market performing as we moved towards 2022? What factors were impacting jet and turboprop values? Jason Zilberbrand, President and Chief Technical Officer at VREF shares some insights…
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hat a difference a year makes! The doom and gloom within the pre-owned aircraft sales market just over a year ago is almost hard to believe. Here’s the latest market report as Q4 2021 got under way. While there are still many unknowns in terms of the global supply chain, inflation, interest rates, and another winter of pandemic, the one thing we can say for sure is that General Aviation is back, as evidenced by recent used aircraft sales activity. There was a time when that wasn’t even a thought. Cheap airline tickets, and service to every part of the world made it easy to forget how critical General Aviation is to the economy. Today, however, the erratic behavior of passengers on commercial flights has been problematic, leading to a number of aborted flights. Attacks on airline employees and fellow passengers have made the headlines. As if the airlines needed any more issues to deal with, they also face labor problems, pilot shortages and vaccination mandates. These issues have helped propel private air travel, giving it a
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prominent place in today’s economy. Many former airline passengers have experienced the benefits of Business Aviation and made a permanent shift, and they are unlikely to ever return to the airlines. This is all good news for General Aviation, and especially for Business Aviation. The transactions reported in Q3 2021 comprised an interesting mix of first-time buyers and management companies seeking to add aircraft to their already busy, stressed fleets. Several of these large operators are turning business away, simply unable to support any additional growth for the time being. Q4 is traditionally a hectic time of year for those in aviation. In normalized markets, the time between Thanksgiving and Christmas is the busiest period, and it’s not uncommon to see two- to three-times the number of aircraft valuations coming through VREF’s software. This, however, is not a regular market… It appears ‘normal’ may be a thing of the past as the global economy shifts from pandemic towards recovery. Or maybe the economy is just dealing with the fact that the virus may be here for the longer-term.
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