Concerns are growing among bankers and analysts that changes to the economic lives of airliners driven by high fuel prices and availability of young, efficient types are accelerating the depreciation of older equipment.
DVB Bank's head of aviation research Bert van Leeuwen believes that while the length of an airliner's life measured in years has probably not changed much, values are being negatively affected. Speaking to Airline Business for its interactive special report on finance
, he said there were several issues changing the depreciation curve: "The fuel price is now higher than ever, the manufacturers are offering more efficient airplanes and there is a wide availability of aircraft on operating lease, which makes it easier for an airline to change to a new generation," he said.
"The closing of countries to airplanes of a certain age is another element. So we believe that the value depreciation of aircraft will be a lot steeper in the future which has significant consequences for the airlines as well as for investors and leasing companies."
Rob Morris, a senior analyst with Flightglobal's Ascend advisory arm, concurs: "There is evidence that the economic lives of airliners are reducing, but the big issue is depreciation," he says.
"The average life of an aircraft retired last year was about 24.5 years - significantly lower than it was in 2008. We're not sure yet whether this is a structure change. We think the industry needs to think about its depreciation models."
Boeing Capital's managing director of capital markets and leasing, Kostya Zolotusky, has seen no evidence of a significant change in how long airliners are remaining in service: "We do not believe that the economic lives have been meaningfully altered," he told Airline Business.
"We acknowledge that the [recent] higher oil price did reduce the economic life of passenger airplanes by about two years from over 25 years to a shade under. No data that you can point to forecasts that the economic lives of current generation aircraft will be lower [than previous generations]." The 2013 Airline Business interactive finance special is out now