Reading Weekly Market Changes

Before shopping for an aircraft or putting one up for sale, buyers and sellers often size up preowned market activity based on three metrics: How many transactions? What’s the inventory level? And how far have values fallen vs. a year ago? That’s all useful information, but it’s also worth keeping in mind how much conditions can change between the time an aircraft goes on the market and the time it sells.

You can find ample evidence of that in the weekly reports issued by AircraftPost, an aviation data supplier and consulting firm. These reports are a great way to see the dynamics of the market and how random and challenging the data can be to analyze. They can also be valuable tools for helping you select a broker, as we’ll explain. 

When an aircraft comes to market, it appears on a change report with make, model, year of manufacture, and serial number, along with its “ask price”—usually a dollar figure, but “make offer” is common. (“TBD” is also seen in the “ask” column on occasion.) The most common market change, week after week, is the price—usually a reduction, though the modification could be from a dollar figure to “make offer” or vice versa. An upward adjustment is unheard of; if an aircraft owner is unhappy with pricing, the report indicates the next most common change: “withdrawn from market.” “Broker change” is another sign of owner dissatisfaction and is often accompanied by an “ask price” change. Once a deal with a buyer is concluded, the weekly update notes the particulars and indicates “sold.”

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A ‘Fundamentally Changed’ Preowned Market

Transaction and inventory statistics indicate a steadying market—but some wonder how long this situation can last.

Major changes occur weekly, with sudden spikes in activity that seem unlikely to have resulted by chance. For example:

• Why in the week ending May 10 did five Dassault Falcon 7Xs have price changes with no change of broker listed? (Three went from “make offer” to amounts ranging from $21 million to $38 million; another two dropped from $30 million to $28 million and from $29 million to $27.95 million).
• What ignited the sell-off in Gulfstream 550 futures in the week ending March 7, with five of these aircraft registering price changes? 
• Why did four Challenger 300s come to market in the week ending April 18?
• The week ending April 12 saw heavy Learjet 45XR activity: two sold and the price of a third dropped from $2.39 million to $2.19 million. Were the two bought by a fleet operator, and was the price change in response to the sale?
• Why was the week of March 29 on fire with Hawker 800XP activity? (Two were withdrawn from the market, while six others had price changes, including one that was reduced by 27 percent.)
• What was behind the sudden contraction of CJ4 inventory in the week ending February 8, with one sold and two withdrawn from the market?
• With demand for clean, late-model aircraft reportedly strong, was the owner of a Global 6000 with an “ask price” change from $37.25 million to $33.95 million during the week ending May 10 motivated by the impending delivery of a Global 7500?
   

Activity shifts like those cited above affect practically all preowned business aircraft, and if you’re thinking of buying or selling, you’d certainly want to know what’s behind any changes regarding the model you’re offering or considering. Qualified brokers should be able to provide that insight; they’ll know the back stories and who’s representing what aircraft and should have strategies for responding to the changes. When selecting a broker, therefore, you’d be smart to ask questions about such changes. If you don’t receive helpful answers, you might want to choose a different broker.