Reason 20 – Turbocharged Cirrus

This week I spoke to Steve Schwartz with TAS Aircraft Sales. He publishes an annual newsletter on the pre-owned Cirrus market; however, it’s only mailed to Cirrus owners. I wanted to get an update from Steve, add some analysis and share. It’s the type of information I was looking for when considering a transition to Cirrus aircraft but it wasn’t readily available.

TAS Aircraft Sales and Lone Mountain Aircraft Sales are part of the Cirrus certified pre-owned network. Both companies have said 2014 was a record year for unit transactions among pre-owned Cirrus aircraft.  And, Q1 2015 has been stronger than normal according to Steve.

Today’s market may be a “Win – Win” for both buyer and seller. More pilots want to fly Cirrus aircraft and in particular turbocharged, but available inventory is low. It’s almost a perfect balance.

Reason 20 – Demand is up and pre-owned Cirrus aircraft availability is low

Currently, the market is slightly under-supplied. Total pre-owned Cirrus inventory fell to a low of 160 units in December 2014. This spring, it increased to about 190 units but those listings include foreign and fractional-sales, which means the net supply for buyers in the United States is lower – at about 160 units.

Pre-Owned Inventory VS. Cirrus Fleet Shipped through December 31, 2014

Spring 2015 SR22 Turbo SR22 NA SR20 Total
Sale Listings 61 87 43 191
Less: Foreign* 10 14 4 28
Net USA 51 73 39 163
Total Fleet* 1,319 3,323 1,229 5,871
Pre-Owned Mkt 3.9% 2.2% 3.2% 2.8%

* Notes: Total Fleet based on GAMA.areo Reports for Cirrus units shipped through December 2014. Sale listings estimated Spring 2015. *Foreign includes Fractional sale listings. sSr22 (na) equals sr22 normally aspirated.

Overall, about 2.8% of the Cirrus fleet is available for sale in the United States. Steve says, a pre-owned fleet inventory of even 4% is considered low relative to other aircraft makes and models. The listed inventory remains well under the historic high of 230 units. How does this affect Cirrus asking prices?

New aircraft have steep price depreciation initially but then it levels off. Buyers of new aircraft are simply in a different group. They enjoy the new purchase experience, and offset depreciation with savings from spinner to tail maintenance programs and tax credits. They don’t seriously consider a pre-owned purchase.

But for buyers of pre-owned Cirrus G1 and G2 aircraft the prices have been “stable” over the past several years, and Cirrus models, such as, the SR22-G3 before FIKI are seeing very strong price stability. This is good for owners and buyers alike.

We’ve all seen sharp price declines in stocks and housing after the Great Recession.  It’s good to see those markets recover and now we’re seeing positive signs of recovery in general aviation.

Demand for composite technically advanced aircraft should continue to grow. If you’re not already in a Cirrus – then look at the trend and consider a migration. As Wayne Gretzky says, “Skate to where the hockey puck is going to be . . . not where it is.”

Next week I’ll muse on why the Cirrus SR22TN-G3 Turbo may be one of the best pre-owned values.

Copyright 2015 wikiWings, LLC, All rights reserved

Leave a Reply