In the post-pandemic market, regional air travel has proven a key driver in aviation recovery, but which jets and turboprops have performed best by value in 2021? Using our aviation intelligence platform, and insights from our award-winning appraisal team, we highlight the top and worst performers for the year.
IBA has seen a resurgence in demand for the smaller members of the Embraer E1 aircraft family, with examples of the E170 exiting British Airways, Eastern Airways and Aeroméxico Connect, and moving into the fleets of American Airlines & Envoy. This has helped to drive an 8% increase in market value across all vintages. IBA expects a 10-12-year-old E170 to lease for between US$77k-86k per month.
The more modern design of the Embraer E-Jets has reduced the market favourability of the older CRJ aircraft overall, with the CRJ-900 showing an overall market value decrease of -8.3%across all ages in 2021. The expected lease rates that could be achieved for mid-life aircraft have also been adjusted downward, with aircraft in the 10-12 years age range attracting market lease rates in the range of US$ 76 k - US$ 84 k per month.
The smallest ERJ family member, the ERJ-135LR, faced a market value decline of 1.4% across all ages in 2020. This represents the smallest decline of aircraft in this class (featuring the ERJ-135LR, 140LR, 145LR and CRJ-200LR). This was closely followed by the ERJ-145LR, the value of which was reduced by 1.6%.
Source: Derin, Flickr
The Embraer ERJ-140LR witnessed a 4.1% drop in market value in 2021, the highest of the category. The largest of the aircraft family, ERJ-145 aircraft are valued between US$ 1.14 and US$ 1.85 million at the close of 2021.
The DHC8 Q400 aircraft showed a 3.3% increase in value in 2021. Whilst the failure of UK-based regional carrier Flybe created an oversupply of DHC8 aircraft early in the pandemic, many of these aircraft have transacted and the market appears to be recovering. Some inventory with lessors is clearing, and we have seen placements to Connect Airlines, Cobham, LAM and LuxWing in the first half of 2021.
The ATR72-500 has shown a 3.2% reduction in market value in 2021. Whilst it is an ageing type with reduced demand for continued passenger operation, there have been some recent lease placements in Australia with HeviLift and Pelita Air in Indonesia. Some demand exists in the Passenger to freight (P2F) market, and some lessors' lease rates can attract a premium of US$ 10k+ per month for a -500 freighter when compared to a passenger aircraft.
IBA Insight flexibly illustrates multiple asset, fleet, and market positions, actual and potential, to inform client choices and identify acquisition opportunities. Immediate access to crucial aircraft, engine, lease rate and fleet data eases appreciation of historic and future aircraft concentrations and operator profiles.
IBA presents: Ask the Appraiser. Our series of regular short webinars, designed to deliver you vital updates on how values are performing across the different aviation asset classes. In the final session of the series, join Phil Seymour and Rami Abdel Aziz for an overview of the helicopter market. Watch the recording
IBA presents: Ask the Appraiser. Our series of regular short webinars, designed to deliver you vital updates on how values are performing across the different aviation asset classes. In the third session of the series, join Phil Seymour and Mike Yeomans for an overview of the narrowbody market. Watch the recording Topics include: The trajectory of values and lease rates The state of supply and demand Fleet evolution What’s happening in the macroeconomic environment, and the impacts on the sector If you have any further questions, comments or feedback please get in touch with Mike Yeomans. The data used in this webinar is from IBA Insight, our leading intelligence platform for aviation finance. IBA Insight combines speed, accuracy, visual analytics and intuitive navigation to deliver actionable insight from comprehensive, integrated fleet, values, flight, carbon and market aviation data. More information can be found here.
As Embraer announces a rethink on its latest Turboprop concept, we use fleet data from our aviation intelligence platform InsightIQ to analyse the global Embraer civil jet fleet. Image source: Embraer
In anticipation of IBA's forthcoming July Mid-Year Aircraft Values Update Webinar, we have been looking ahead at some key aviation industry trends to expect in aircraft valuations. Though many will not see base value adjustments for many aircraft asset types, we are forecasting further market value softening in 2021 for some.
Aviation Asset Valuation is often a thoroughly debated and complicated subject - no matter where the industry is in the aviation cycle. The Covid-19 pandemic has created an unprecedented downturn in air traffic. As such, it is even more important to consider valuation definitions and the correct and valid use of them for pending transaction and for year-end audit purposes. Designed for airlines, lessors, financiers alike, strengthen and build understanding of valuation methodology by joining IBA, the 2020 Appraiser of the year. Combining our specialist valuation skills, with commercial and industry expertise, our Masterclass covers: All you need to know about Base Value and Market Value and how they should be used - IFRS/IAS 36 Impairment of Assets Should impairment of the airline book value be considered and how market or base value should be applied International Standard on Auditing ISA 620 Voted Appraiser of the Year in 2012, 2018, 2020 and with over 30+ years of knowledgeable market experience, we have a deep understanding of the market. This session is a must for those looking to refresh, build or renew their understanding of Valuations. The slide deck is available to download here. If you have further questions please contact: Mike Yeomans