As we embark on the New Year, we have to look closely at last year to see how difficult it is to predict how active–or inactive–aircraft sales will be. Last year held some real standouts such as the Citation Sovereign and Challenger 604, but even some that tripled in inventory (the G550) didn’t look as soft when you learned that the choices were spread fairly evenly around the globe. Europe still has an abundance of aircraft for sale, and if Mario Draghi is successful in pulling the Eurozone off the finance precipice you might see a recovery there. However, the recent slide in oil prices could act as an offset, keeping the Continent in the doldrums in the year ahead.

While the slide might be a detriment to the European market, it could be an elixir to aviation in general as the price of jet fuel has tanked in the past year, lowering the cost of operation and essentially making it cheaper to fly. This unexpected bonus could help the momentum generated last year spill into this year. Month over month, year over year, the used supply has been shrinking, despite a growing worldwide fleet that added more than 525 new aircraft last year. At the end of 2013 there were 2,460 used aircraft for sale; that number stood at 2,241 at the end of last year, a net reduction of more than 200 in a 12-month period.

‘Good’ Listings in Short Supply

Despite the steady reduction of supply, there’s still plenty of product for buyers, though last year was the first time in several years my industry counterparts and I commiserated about not having enough “good” listings. Good can be defined as a marketable piece, generally an actively traded, late-model U.S.-based aircraft that’s market priced.

Consider that 30 Sovereigns have sold in the past six months, leaving 13 for sale right now. In the same period only 16 Citation Xs sold, leaving 37 for sale now. It might take some counterintuitive thinking, but right now if I were in the market to buy a super-mid I would be taking a close look at the Citation X. With so many choices, prices have softened and with some others in this segment firming in price, an oversold condition could make the right X ripe for the picking. Also factor in that only five of the Sovereigns are based in North America compared to 28 of the Citation Xs, perhaps emboldening the Sovereign seller on asking price and making the Citation X seller more accommodating.

Interestingly, the Challenger 300 and G200 ran neck and neck over all of 2013, but a big shift favoring 300 sales has come in the last six months, with 15 of the Canadian-built model selling compared with just eight G200s. The 33 G200s for sale worldwide represent more than 13 percent of that model’s fleet, while the 32 Challenger 300s on the market equate to just 7 percent. Two thirds of the G200 choices are based in North America, while slightly fewer than half of the 300s for sale call that region home.

As the inventory has crept lower, we’re noticing a greater number of buyers engaging the services of acquisition agents, which has always been a seemingly underused arrow in the quiver of every broker, but in 2014 our acquisitions tripled from a year ago. Observationally, it’s interesting that with more information at the buyers’ fingertips than ever before they are increasingly seeking professionals to digest and decipher the market intel to zero in on a target aircraft before an opportunity is missed.

Based on all the year-end activity and buyers teeing up for transactions this month, the market clearly has a full head of steam and looks to stay on the same track it has been on for the past year. Despite the inventory reduction, pricing remains attractive and, helped by lower fuel prices, will likely only build on the positive performance of the past 12 months.