A quick peek into the order books of some of the world’s biggest airliners and airplane manufacturers suggests that the purchase market for used aircraft is diminishing.
Aviation Week’s Robert Wall notes that while Airbus and Boeing quite happily booked orders for more than 1,500 combined narrowbody craft last year – a number that looks set to reach a similar demand in 2012 – the demand for older aircraft simply isn’t recovering quickly enough.
Those who track flights from budget airlines Easy Jet and Ryanair for example may notice that these carriers are flying stocks of Boeing’s and Airbuses that have simply failed to shift on the used market in the past.
“The second-hand market is dead,” Ryanair’s CEO Michael O’Leary told board members bluntly in January. He spoke in response to why the low-cost airliner has failed to move on its relatively young Boeing 737-800s.
“We’ve always been a seller of good young second-hand aircraft. We haven’t got a sniff from anybody for about 2 years on second-hand aircraft. The second-hand aircraft market seems to be very weak,” he added, cites SeekingAlpha.com.
Easyjet similarly had to take its A319 narrowbodies off the market, with an industry official citing a lack of interest in the model as justification for the action. Wall says while others could have leased the stock out for the carrier, doing so would “undermine the focus on its low-fare business model”.
Financing is thought to be one of the major obstacles preventing the take-up of older aircraft. Industry insiders tell Aviation Week that receiving financing for a plane more than three years old “is really difficult”.
High fuel prices are also thought to blame, with even new, but less-efficient planes, struggling to sell in the marketplace.