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Regional Jet Values Stagnate

March 29, 2021

The regional jet segment should be enjoying considerable improvement at least when compared to the widebody segment but this is not the case and values remain static.

While the North American market continues to be the mainstay of the regional jet market and therefore ensures a level of recovery, the type is employed on regional services that involve crossing international borders for which significant restrictions on international travel may be in force. The regional jets are therefore not necessarily being fully employed.

Values are in Millions of US Dollars and are based on The Aircraft Value Reference published by The Aircraft Value Analysis Company Ltd (AVAC) www.aircraftvaluespro.com www.aircraftvalues.net www.aircraftvalues.com. An Aircraft Rating has been included reflecting the suitability of the type for asset based financing over the medium term with a range of A++ (best) through to Eā€”(worst).

 

Regional Jet Current Values US$m ā€“ March 2021
Aircraft Age Value Rtg Trend Analysis
Avro RJ70 1993

1996

0.3

0.4

E- The values of the Avro RJ70 have been experiencing considerable weakness for perhaps a decade. The type is already more than 20 years of age and in terms of asset attraction has long since experienced aversion, particularly as twin engined regional jets have become available at much lower prices.
Avro RJ85 1993

1998

0.7

0.8

E The market for the RJ85 has long since been waning and there remain a number in storage. The aircraft is facing new pressures as the value of twin engined regional jets have fallen.
Avro RJ100 1993

1998

0.7

0.9

E The capacity of the RJ100 was always underestimated and as such was a very credible aircraft offering reasonable and proven economics for a number of operators. There is however, an expectation that values will fall further rather than exhibit any degree of stability.
CRJ100ER 1993

1998

0.2

0.3

E– There is not much to favor the CRJ100ER as age and relevance are the principal negatives. The oldest is now nearly 30 years of age. When the 50 seat regional jet concept was first mooted there was uncertainty as to whether the economics would work. Fortunately, the network system of the U.S. and the initial regulated environment elsewhere allowed the type to gain a foothold.
CRJ200ER(U.S.) 1996

1999

2001

2003

2005

0.3

0.6

0.7

0.8

0.9

E- The values of the type may not be deteriorating but they are also not improving. The aircraft continues to face difficult conditions which will not improve even as the market moves out of the Covid era. There is however, some movement between operators not least because a 50 seater has not been manufactured for some 15 years which means that the used market is the only option.
CRJ700(U.S.) 2000

2003

2005

2011e

2.2

2.8

3.5

7.9

D–

D–

The 70 seat sector is not as strong as might be expected with such seating capacity being eroded by slightly larger offerings that are able to match the Scope Clause limitations that continue to dominate the U.S. market. Elsewhere, the Covid Event has allowed some examples to remain operational while others have seen little attraction in taking the type of storage.
CRJ900(U.S.) 2002

2005

2011en

2016ng

3.0

4.7

8.2

13.0

D+

D++

Production has come to an end in all but name and this continues to weight heavily on the values of the younger types not least because few have been delivered in recent years. The values of the type are vulnerable because of the efficiency offered by the only remaining products ā€“ the Embraer E-Jets. Fortunately, many operators of the CRJ900 can be expected to retain the type for many more years.
CRJ1000 2011

2014

8.0

10.3

D The market for the CRJ1000 failed to realize its potential and values have continued to decline. The type saw only a limited number of deliveries to a handful of customers. The used market may see some issues in terms of placement.
ERJ135ER(U.S.) 1999

2001

0.5

0.7

E- The economics of a 30 seat regional jet were always expected to be suspect and while some can make money in a quasi-regulated market others struggle.
ERJ145ER(U.S.) 1996

2001

2003

0.5

0.9

1.0

E- The type can be moved between operators but the type is facing continued pressures associated with a contracting market and age. The values of the type have been under pressure for many years and the Covid Event has only added to the negatives impacting the type.
Embraer 170Std 2003

2007

2011

2014

2.9

5.4

7.9

9.5

D- As illustrated by the absence of orders and deliveries in recent years, the values of the E170 have become vulnerable to the changing market structure that favors larger offerings. The values of the younger aircraft have therefore continued to experience a decline.
Embraer 175 2004

2010

2016E

4.2

9.0

16.0

C–

C

The E175 has proven to attractive for the U.S. operators seeking to mitigate the effects of the Covid Event. The type may not be fully employed but at least the majority of the fleet is at least generating some revenue. The type though is more focused on the U.S. market and therefore there has to be a note of caution in terms of longer term residual values. Fortunately the delay to the SpaceJet and the E175E2 have allowed the type to remain relevant.
Embraer 190 2005

2008

2011

2014

5.1

8.01

2.0

14.5

D+ The market for the E190 is far from as strong as it should be even taking into account the Covid Event. While some have been placed it is noted that these have not always been placed with operators who intend to use them for passenger service. The aircraft is also facing the issue of age and replacement via the E190E2. The values of the type are therefore not improving and may even fall further in the near term.
Embraer 190E2 2018 25.2 C++ The lower rates of delivery and the limited number in service have at least allowed values to experience a lesser rate of decline. The values have the potential to improve. With respect to the E190E2 the actual specification of the aircraft can see values increase by some ten percent compared to the assumed average aircraft.
Embraer 195 2006

2011

2014

6.5

11.5

15.0

D- The E195 remains in storage in some numbers but then so too most other passenger aircraft. The values have managed to remain stable over the last few months but it has to be noted that the type is being replaced by the larger and more efficient E195E2.
Embraer 195E2 2019 26.2 C+ To some extent the E195E2 should not be underestimated. The very capacity of the E195E2 essentially makes it a mainline type rather than a regional aircraft and offers operators low seat mile costs. The values have therefore not fallen as much as other regional jets and offer the prospect of an improvement as the market recovers.
328JET 1999

2001

0.1

0.1

E- Another 30 seater commuter jet that was designed for a much more regulated environment where high fares were the order of the day. But as the market became liberalized, interest in the type waned. Any value is now in the eye of the beholder.
Fokker 70 1995

1998

0.3

0.5

E– Some still view the F70 as attractive and it certainly does have a low capital cost. If utilization can be kept low then it may remain in service but has long since lost its appeal for asset based financing.
Fokker 100 1987

1993

0.3

0.5

E– The Covid Event may not yet see the end of the Fokker 100 as the type can still provide good service for a few operators. The structural integrity of the type is an advantage.
Commentary reflects changes from last update of August 2020

 

 

 

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