Pre-owned helicopter market remains difficult, but with some positive signs
It’s not altogether clear whether the market log-jam for pre-owned helicopters is loosening up. However, there may be some odd signs judging from Aero Asset’s third quarter report this year.
One of the stalwarts of the oil and gas helicopter market – the Sikorsky S92 – has been notoriously difficult, if not impossible, to sell in recent years with the decrease in new offshore contracts. However, Q3 marked the first pre-owned S-92 transaction in five years.
A report from pre-owned marketplace specialists Aero Asset has revealed that the single S-92 was sold in Q3 for approximately $6 million, a far cry from the aircraft’s $32 million list price back at the turn of the decade.
Sellers are aware that the aircraft is in low demand – with only four pre-owned S-92s currently on the market.
The S-92’s closest competitor – Airbus’s EC225/H225 – also saw one sale last quarter, bringing the total number of pre-owned 225s sold year-to-date (YTD) to three. Over this period, it sold for an average price of approximately $4.3 million. This has kept up the aircraft’s consistent sales volume in recent years. And, if this absorption rate continues into Q4 and beyond, the sixteen 225s on the market could be sold within four years.
Outside of heavy helicopters, it is business as usual. The market is still seeing a substantial oversupply problem, especially in the heavy helicopter sector, with light-twin aircraft continuing to be the most liquid category.
North America was the most active region for helicopter transactions during Q3, hosting 37% of the pre-owned transactions for this quarter, up from 31% in Q2. Europe hosted 25% of transactions.
The third quarter of 2019 saw 27 twin-engine helicopter transactions, making a total of 85 twin-engine helicopters sold year-to-date. The 85 pre-owned aircraft sold has bought the number of twin-engine helicopters on the market to 230, down 20% year-on-year.
The most liquid second-hand market – the light twin – continues to see steady sales. Last quarter, six Airbus EC135s and seven EC145s were sold. The market is driven predominantly by US EMS operators, with consistent demand since 2006-2014 and unit sales averaging between $2-3 million.
Leonardo’s competitor to the 135/145, the AW109 Grand, suffered a substantial drop in pre-owned transactions year-on year. However, the report notes that this is “clearly an anomaly” and expects business to resume as usual soon. The transactions for the AW109SP remained flat year-on-year.
A drop in asking price for the Bell 429 triggered demand, resulting in three transactions this quarter, with four retail trades year-to-date has resulted in high absorption rate.
In the medium-twin market, the Leonardo AW139 continues to dominate the second-hand market, with five retail sales in Q3 and ten for the year as a whole, the average absorption rate of the aircraft type has dropped to 14 months, a significant drop year-on-year.
The Bell 412 has had a stagnant quarter, with zero transactions and only three since the same period last year. The Sikorsky S76C+ and C++ variant transactions have remained flat. Supply for the H155 has doubled and absorption rate is still high.