Used aircraft market

[Ilyushin]

I noticed many people want more money for their planes than that they're worth.

Is this normal, or is it simply a rip-off?

I can barely find a nice airplane for a good price...

Thanks.

[JonesyUK]

Supply & Demand. If people will pay the price then they'll charge as much as they can

[Daemus]

Read through the thread titled "Giving beginner's a better chance in beginner's world"

Right now, it is a few down from yours in this section of the forum.

Direct-URL is https://www.airwaysim.com/forum/index.php/topic,24626.0.html

I ended up there when I was feeling frustrated about the used plane market. It has some good posts about why prices can be so high.

These are the major points I took from what I read I the subject:

• The market reacts to demand. The more demand there is for a certain plane, the higher the price will trend until they just aren't being purchased as much.
• There is a wait time for new planes ordered from manufacturers that seems can be much longer than the 2 week wait for a used plane. Seeing a price close to what you could get one new is likely the result of high demand coupled with the fact that you don't have to wait for the plane to be delivered. It sucks for us newly formed companies who have issues with a small fleet that struggles to cover overhead costs but you have to make the choice; order it today and have it in 2 weeks to start generating revenue from it or let your company sit without an income stream while you wait for either a new plane or wait in hopes that the market prices will drop.
• As companies go bankrupt or replace older planes, the used market gets fed with the repo'd and replaced planes. Time and patience in waiting for the right plane to hit the market, then grabbing it up before someone else does, may be the right move financially if you aren't bleeding from overhead due to a small fleet that can't keep up with your looses. Waiting for a plane that has synergy with your current fleet or isn't so old that you are looking at a money sink with repairs and upkeep could be the right move if you can afford the wait.
• Picking less popular models of planes can result in cheaper prices because the demand isn't there. Some number crunching is probably a good idea when it comes to making the decision on purchasing a plane. Less popular usually means less efficient in terms of potential revenue vs operating cost (higher fuel consumption, slower TAS, less capacity, etc).

[Ilyushin]

Thanks for your detailed replies.

Would it be wise to run an used Tu-154M EHAM-UUEE?
Seeing as it is pretty cheap and has quite some seats, and they're younger than the 727s on the market at the moment.
Or is it too much of a gas guzzler?

If yes, would it be a good idea for me to start running that right now? I have 296k in bank atm, I'll be in the red. Slot fees at EHAM are very expensive too...

I somehow just want a gorgeous Russian bird in my fleet.

[Daemus]

I am still real new to the game so I don't think I am capable of looking at it from all aspects yet but just plugging data into the rough spreadsheet I made for plane efficiency shows me the following. For this I was using one of the 154's on the market's values vs the values of one of my 727's.

The 154M will operate at 62% of the efficiency that a 727-200adv would in terms of pax miles. Keep in mind that capacity, speed, and fuel burn values can vary from plane to plane of the same model.

If traveling at cruise TAS the whole time for a week, the 154 would generate 92% of the revenue from tickets sales that the 727 would. This is constant flight at cruise speed. It doesn't include maintenance costs for the planes or age of the planes. Turnaround time is also not calculated, though separately done the 154 has a 22% higher required turnaround time than the 727. Another factor to consider is the requirement of 50% more crew members (2 extra actual members) for the 154 over the 727 - check your personnel info for your company specific crew costs.

One final thing I don't take into consideration is ground time. Each plane will have time it is not in flight earning revenue. This shouldn't be overlooked as you not only have to figure for the loss of potential revenue but even more importantly, the lease payments per week vs the amount of non-revenue time. You still are paying off the lease when a plane is sitting on the ground. A cheaper lease payment means it hurts you less when the plane isn't earning revenue, though getting some specific numbers for expected ground time and comparing those to the cost of a lease would be a good idea if you are expecting a noticeable amount of ground time. Remember that A, B, C, and D checks all are ground time that you are making lease payments during too, not just turnaround time and gaps in between routes.

These are just simple calculations and I am still working on more complex formulas to better calculate an overall cost vs value efficiency. You are by no means getting the full picture from this, just some basic values that I use to give myself an idea of what a plane's potential is. Finally, keep in mind that I haven't been in a math classroom for years and probably am just completely wrong with how I calculate things.

[ksjoet]

My spreadsheet gives the following data from 727-200adv vs 154M

I've taken two aircrafts currently available on the used marked as a basis.

Fuel price: 208 USD (current price in Beginner's World)
Flight hours each day: 9 (rough average set by me)
Pilots salary Large AC: 7750 USD month
Cabin crew salary: 2790 USD month
Crew salaries are based pr. crewteam. Depending on the routes the AC flies you can probably double or triple this.

These are the costs for a whole year:

Code Select Expand

Boeing 727-200Adv
Age: 18.08
Range NM: 1930 NM
Size class: Large aircraft
Max pax: 189 (high density)
                               
Lease price $199 530,00 $2 394 360,00
A check          $22 512,00 $1 170 624,00
B check          $58 531,00   $702 372,00
C check       $1 350 709,00 $1 350 709,00
Fuel             4290 kg/hr $3 241 309,50
Crew salaries           $412 920,00
Total                 $8 962 603,20  
Pr. Seat            $47 421,18



Tupolev Tu-154M
Age: 9.4
Range NM: 2070 NM
Size class: Large aircraft
Max pax: 180 (high density)

Lease price  $254 420,00 $3 053 040,00
A check           $23 949,00 $1 245 348,00
B check           $62 268,00     $747 216,00
C check        $1 436 944,00 $1 436 944,00
Fuel             6660kg/hr $5 031 963,00
Crew salaries           $479 880,00
Total                $11 513 482,80  
Pr. Seat            $63 963,79

Not included are the overhead costs, but they should be the same for each AC anyway.

I think the numbers speak for themselves.