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Aero Asset reports on preowned helicopter market first quarter

Aero Asset of Toronto released its First Quarter 2020 Preowned Helicopter Market Trends report, noting the period was generally positive as the industry was heading into a slowdown brought about by the COVID-19 pandemic and an oil-price crash.

“Preowned sales dollar volume was up 37 percent to $152 million in the first quarter on only an eight per cent increase in unit transactions, compared to the 2019 quarterly average,” said Emmanuel Dupuy, sales director, Aero Asset. “Preowned supply increased four per cent to $909 million on 240 units, an increase of five per cent. The industry absorption rate remained stabilized at 21 months, while deals in the pipeline fell 30 per cent to 18 units.”

Dupuy notes Aero Asset will closely monitor the 2020 second quarter and beyond for any signs of a recovery. “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.”

Aero Asset’s Q1 report indicates the light twin market experienced an increase in supply in Q1 with stable retail sales volume quarter over quarter (QoQ). The medium twin preowned supply remained stable and retail sales increased by a third to 15 closings QoQ, explains Aero Asset, while the heavy twin helicopter preowned retail sales doubled to four closings and supply declined by 30 per cent QoQ.

The two most liquid preowned markets in the first quarter, according to the Aero Asset report, were the AW139 with seven retail sales and a year of supply at Q1 trade levels, and the Bell 429, which saw the biggest improvement in liquidity Q1. Aero Asset explains the two least liquid markets were the A109E Power, which saw the largest drop in absorption rate Q1, and the AW109S/SP which experienced a 50 per cent decline in retail sales volume compared to its 2019 quarterly average and a 35 per cent increase in supply QoQ.

The report also notes that the number of twin-engine preowned helicopter deals in the pipeline declined 40 per cent compared to Q3 2019, and 20 per cent 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 Q4 and 31 units Q3 2019.

“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,” said Dupuy. “The VIP market accounted for 60 per cent of retail sales, while utility configurations comprised 26 per cent and HEMS transactions accounted for 14 per cent of the retail sales volume.”

View Aero Asset’s complete market report