The 2016 end of year GAMA statistics came out, and the picture they painted was not rosy. Deliveries of new aircraft were at a low point last seen in 2004. On a unit basis, the manufacturers delivered in 2008 2.5x more than they did in 2016. The effect on the OEMs, owners, lenders and any other stakeholders in the demand and values of private aircraft has been, and continues to be, profound. Lower demand and a rising fleet size will continue to encourage the price declines that have marked the last 9 years in the industry. The rate of decline remains in question, but a continued decline in prices is inevitable.
The good news is that we are seeing more first time buyers getting into aviation as a result. With asset values where they are, some tremendously capable aircraft are available for price points that were unthinkable only a few years ago. New users of private aircraft are a wonderful sign and something to be cherished as they are the ones that will keep the industry running many years to come.
Analysts have been predicting the previous year as the nadir since the onset of the financial crisis and continue to do so. We do not see a material increase in demand in the near future and therefore believe that we are existing in a new normal with regards to values and demand. But the reasons for private aircraft ownership have not changed – there is still no faster, more convenient and better travel time saving tool than private aviation.
You can view the full report here: GAMA 2016 Year End Report
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