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Aircraft Archive: McDonnell Douglas
Residual Values Once Again Need to Focus on Narrowbody Replacement
The fall in the backlog combined with lower fuel consumption offered by the CSeries and the emphasis on lower emissions, is increasingly forcing Airbus and Boeing to reconsider their replacement plans for their respective narrowbody aircraft. Previously preferring to push back a replacement to perhaps 2020 and beyond, both manufacturers…

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February 15, 2010
AVI
Tech Insertion Engines Continue to Warrant Premium
The Tech Insertion engine introduced by CFM in 2007 on the B737NG and A320 continues to offer sufficient advantage over previous variants as to justify an increase. The Tech Insertion engine has become the standard production engine for the CFM56-7B and CFM56-5B engines that power the A320 and B737NG families.…

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February 15, 2010
AVI
Virgin Switch Highlights End Game for A340 Values
Single Digit Backlog Will Prevent Value Recovery With Virgin Atlantic Airways having switched six remaining orders for the A340-600 to the A330-300, the backlog for the A340-500 and -600 amounted to no more than seven aircraft as of the end of 2009, thereby pointing to further erosion of values. Virgin…

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February 1, 2010
AVI
Transaction Pricing Favor Newer Aircraft
The recent Dublin Air Finance conference saw the mood of cautious optimism contrast with the gloom of a year ago. The market is perceived to be bumbling along the bottom of the cycle, having essentially stopped falling. The consensus assumes that any upturn in the fortunes of the airlines will…

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February 1, 2010
AVI
Start of Value Recovery As Key Indicators Move Up
Recent data points to an improving market for passenger traffic which has the potential to eventually lead to an improvement in lease rentals and values. The rise in cargo traffic – the harbinger of an upturn in the cycle – is being accompanied by data that shows an improvement in…

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February 1, 2010
AVI
Rentals Start to Exhibit Stability As Market Improves
Cargo traffic levels have increased sufficiently to encourage the reintroduction of previously surplus capacity. Chinese carriers saw a significant improvement in November, registering year on year rises of between 30-60 percent compared to the previous year. In particular China is importing more products, outpacing exports. There is increased emphasis on…

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February 1, 2010
AVI
Widebody Values Now Have Potential to Rise
The market is likely to need time to recover but for some widebodies the worst may be over. While there is no indication of a rapid thaw, the prospect of further falls has receded – except for perhaps the B747-400 which may fall victim to JAL restructuring. Values are expected…

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February 1, 2010
AVI
JAL Restructuring Underlines MD90 Vulnerability
As part of its restructuring JAL is to divest itself of its fleet of some 16 MD90s. The type has always subject to waning values for perhaps a decade. Despite the JAL issue Delta has announced that it will acquire nine MD90s from China Eastern as well as two from…

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February 1, 2010
AVI