24/11/2021
Regional air travel has proven a key driver in aviation recovery, but which jets and turboprops have performed best by value in 2021?
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IBA has seen a resurgence in demand for the smaller members of the Embraer E1 aircraft family, with used 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$ 77 k and US$ 86 k 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 the CRJ-200LR). This was closely followed by the ERJ-145LR, the value of which reduced by 1.6%.
Image: 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 into continued passenger operation, there have been some recent lease placements into Australia with HeviLift and Pelita Air in Indonesia. Some demand exists in the Passenger to Freighter 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's value opinion is fed by a combination of analysis, research, discussion with the trading and leasing community and comparison with similar data points. We compare, analyse, and scrutinise transactions we see in the market and discuss these amongst our elite appraiser team through regular value forums to ensure our value opinion is relevant, well-researched and of the highest quality.
If you have any further questions please contact Mike Yeomans.
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