Aircraft are retiring at younger ages and this is benefitting part-out companies looking for newer and old assets, according to speakers at the International Society of Transport Aircraft Trading conference in Rome today.
"Since 2008, the average retirement age is down 8%. This compared with an increase of 66% in the average retirement age between 1980 and 2008," said MBA's president and chief executive Robert Agnew.
"When GDP is down, retirements go up," he adds.
GA Telesis' president and chief executive Abdol Moabery said there are many aircraft available for retirement and that part-out companies act on an opportunistic basis.
He concedes that the useful life of an aircraft is between 20 and 30 years but also acknowledges the events leading to the situation today. "Post 9-11 bankruptcies put pressure on assets. We purchased 11 Boeing 737-400s with an average age of eight- to-nine years. We paid $3 million per aircraft. In 2008 trading on the 737-400 was $11 million per aircraft."
He said that in 2007-08 part-out companies went through the worse period as "no aircraft were available" but activity is plentiful now. Moabery cannot say whether it is a short-term cycle but points out that even newer aircraft models are not immune.
"Last year there were more Boeing 737 Next Generation aircraft parted out than 757s," he says.