How To Navigate A Volatile Helicopter Market

These past couple of years, home prices have skyrocketed, new car shortages are driving up
prices of both new and used vehicles, and extreme inflation shows no end in sight.
I am by no means an economist, but being in helicopter sales, I have been watching the market
closely enough, and here’s my take: the helicopter used inventory is limited, OEMs are behind
on new helicopter deliveries, and we have seen historically low interest rates. What does this
mean for helicopter owners and operators? Let’s dive deeper into each area.

Limited Used Inventory

When COVID-19 shut down our global economy, we learned quickly what operators were over-
leveraged and those who had cash to spend. As a result, during this first stage of the pandemic,
many helicopter owners and operators panicked enough to “fire” sell their current machine(s).
Consequently, the market was flooded with inventory, and those owners and operators who had
cash in hand took advantage of the wildly below-market asking prices. The early pandemic sell-
off was short-lived, but the damage was done. Almost overnight, inventory for all makes and
models was severely decreased.

OEMs Struggle to Deliver New Aircraft

I recently sold my used Toyota for a profit, despite putting nearly 80,000 miles on the vehicle.
Like cars, used helicopters have become highly sought after as the OEMs struggle to deliver new aircraft promptly. Unfortunately, supply chain problems coupled with reduced workforces due to the pandemic, have made it very difficult for OEMs to get aircraft out the door. With piston helicopters (specifically Robinsons), the stay-at-home orders enforced by the state of California limited the number of workers, severely increasing the time for new aircraft and the time it took to receive an overhaul kit.

Low Interest Rates

As I write this blog, the Fed is desperately trying to decrease inflation by increasing interest
rates, meaning we are no longer seeing such appealing rates regarding aviation lending.
However, for nearly two years, we saw lenders go below 4% for aviation loans, bringing more
buyers to the table. With historically low inventory, more buyers lead us to a competitive
“squeezed market.”

Should You Sell?

The market is definitely cooling down, but our team is still seeing final sales prices far exceeding those figures we saw just a few years ago. I would suggest working with a professional who is familiar with the current market trends as we have seen a lot of sellers leave money on the table using outdated valuation figures. If you have considered selling your helicopter, now is the time — with the economy starting to slip I am not sure how much longer we’ll see the market inflation.

Should You Buy?

By and large this is a sellers’ market; however, we have had a lot of success helping buyers
during this difficult time by locating aircraft that are off market. Instead of trying to secure a
helicopter that is publicly listed–with multiple buyers making competitive offers–we have found
great luck working with our network and finding helicopters that are “for sale” but not publicly
available. In these scenarios you are not bidding against other buyers. What’s more, off-market
sellers do not feel the same feeding frenzy of buyers, so they are usually more open to reasonable offers. Just like any market, the helicopter market is UP then DOWN, then UP again and will be ever changing. The same conditions that exist today might be different tomorrow. If you are thinking about buying or selling, work with someone who is immersed in the helicopter market. That way you can work from their experience and know what to expect.

Are you looking to buy in this market, let us support your journey. Feel free to email me at halsey.s@sellacopter.com, or if you found this blog via social media, share your experience in the comments! 

Written by Halsey Schider

CEO and Founder of Sellacopter.