Asian Sky Quarterly 2022 Q4

MENA PROFILE: BUSINESS JET
PRE-OWNED MARKET SITUATION 1
Inventory Value (USD) 2
450,000,000
400,000,000
350,000,000
Corp. Airliner
300,000,000
250,000,000
200,000,000
Long Range
150,000,000
100,000,000
Large
50,000,000
0
Medium
Light
Jan
20
Mar
20
May
20
Jul
20
Sep
20
Nov
20
Jan
21
Mar
21
May
21
Jul
21
Sep
21
Nov
21
Jan
22
Mar
22
May
22
Jul
22
Sep
22
Nov
22
Jan
23
Source: AMSTAT & Global Sky Media
Major contributors to the pre-owned inventory value in the MENA
region included Corporate Airliners, as well as Long-Range and Large
cabin jets.
compared to six in 2021. As a result, buyers across the global market
found it increasingly difficult to find their desired aircraft and often had
to pay inflated prices to acquire them.
The cumulative inventory value for pre-owned aircraft listings
dropped yearly from an average of USD$361 million in Q4 2020, to
USD$234 million in Q4 2021. This is reflected in inventory values
for Large cabin aircraft, which reached a peak of USD$101 million
during Q4 2020 but reduced to a peak of USD$85 million in Q4 2021.
However, the cumulative value has started to rise again, as it stood at
USD$476 million at the end of 2022.
The COVID-19 pandemic and tax relief measures introduced by the
Trump administration in the US resulted in a surge in demand for
business jets, which led to higher consumption of pre-owned market
inventory and a decrease in market inventory value for the past three
years. During the pandemic, the MENA region had become a major
source for the global pre-owned market, particularly in niche markets
like Corporate Airliners, with eight transactions completed in 2022
External factors that potentially impact the pre-owned market may be
attributed to ongoing geopolitical instability in the region, particularly
involving conflicts in Yemen, Syria, and the Israeli-Palestinian
territories. The greatest impact is on aircraft condition, where aircraft
may be subjected to harsh operating conditions (including restrictions
to airspace), which could impact their overall value. This could
negatively impact market value across the inventory; while a decrease
in transactions normally results in the rise of the inventory value, the
drop in asking prices influenced by the physical effects of ongoing
conflicts may yet depress overall value over rises linked to greater
supply.
The potential political stance in key markets may further exacerbate
intra-state conflicts that could subsequently affect the confidence of
major stakeholders from investing further in the MENA market.
Notes: 1. Insufficient data is available for the Vey Light Jet for sale, therefore this particular size category is not displayed on the graphs. However, the available data has been
incorporated in the calculation of cumulative inventory value, total average days on market, and percent of aircraft for sale.
2.Inventory value is adjusted by Global Sky Media based on aggregated data. It is calculated by taking the number of aircraft for sale, multiplied by their average asking prices.
FOURTH QUARTER 2022 — GLOBAL SKY QUARTERLY | 11