Aero Asset says first quarter was strong for helicopter sales, but Covid-19 slowdown has started

The First Quarter 2020 Preowned Helicopter Market Trends Report produced by broker Aero Asset shows that the first three months of 2020 were strong for helicopter transactions. However, it is expecting a significant slowdown due to COVID-19 and oil price crash.

“Aero Asset will closely monitor the 2020 second quarter and beyond for any signs of a recovery, as we are already seeing the immediate effects of the global COVID-19 pandemic and the double whammy of a worldwide crash in oil prices. Beyond the human scope of the pandemic, both events are wreaking havoc on economies around the world,” said Emmanuel Dupuy, sales director, Aero Asset.

Aero Asset’s says that the light twin market experienced an increase in supply in the first quarter of 2020 with stable retail sales volume quarter. The medium twin preowned supply remained stable and retail sales increased by a third to 15 closings compared to the last three months of 2019. Heavy twin helicopter preowned retail sales doubled to four closings and supply declined by 30% – compared to the last quarter of 2019.

“Preowned sales dollar volume was up 37% to $152m in the first quarter on only an 8% increase in unit transactions, compared to the 2019 quarterly average,” said Dupuy. “Preowned supply increased 4% to $909m on 240 units, an increase of five percent. The industry absorption rate remained stabilized at 21 months, while deals in the pipeline fell 30% to 18 units,” he added.

The two most liquid preowned markets in the first quarter were the AW139 with seven retail sales and a year of supply at first quarter trade levels, and the Bell 429, which saw the biggest improvement in liquidity. The two least liquid markets were the A109E Power, which saw the largest drop in absorption rate in the first three months of 2020, and the AW109S/SP which experienced a 50% decline in retail sales volume compared to its 2019 quarterly average and a 35% increase in from the quarter before.

Aero Asset says that the number of twin engine preowned helicopter deals in the pipeline declined 40% compared to Q3 2019, and 20% compared to Q4 2019. The amount of deals pending at various stages of transactions at the end of Q1 2020 declined to 18 units, down from 22 units in the fourth quarter of 2019 and 31 units in the third quarter.

“The most active market during Q1 2020 was the AW139 with seven retail sales while the least active were the EC155B1/H155 and S76D with zero transactions,” Dupuy said. “The VIP market accounted for 60 percent of retail sales, while utility configurations comprised 26 percent and HEMS transactions accounted for 14 percent of the retail sales volume.”

The report can be downloaded from: https://www.aeroasset.com/report

 

 

Alasdair Whyte

Alasdair launched Corporate Jet Investor and Helicopter Investor in 2010. He has more than 15 year's experience as a financial journalist and has specialised in aviation for much of this time. As well as editing the website, Alasdair helps to organise our international conferences and events. He also regularly chairs them as well as other industry gatherings.

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