MARKETLINE 2013 NEWSLETTER JET. By Dennis Rousseau President and Founder AircraftPost.com

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1 MRKETLINE VOL 26 NO NEWSLETTER YTD Pre-owned Transactions & Prices Continue Down y Dennis Rousseau President and Founder ircraftpost.com When viewing a random selection of pre-owned transactions for the first 5-months of 213, the number of sales are trending down 15 percent when compared to the same period in 212. ctual selling prices also are down on average 15 percent, while inventory levels for the same group of business jets has increased 2 percent. s you consider these facts we must also take into account other mitigating factors, such as the year of manufacture of the aircraft sold, cost of the aircraft when it was new, the cost new today, as well as nominal depreciation, et al. y way of example, an aircraft that sold new in 25 for $44 million and today sells for $32 million is not too far off Therein in the case of overproduction, we face dynamics that were once not a factor, such as eroding residual values. of a 4 percent per year depreciation schedule. From another perspective, it has retained 73 percent of its original cost, which falls in line with a 3-year useful life. number of factors continue to affect growth and stability in our industry some are geopolitical, others are related to the global financial debacle that started in 28. Within our industry, where 25 aircraft were once considered a standard production run, we now have 4+ that will eventually compete in the preowned market. Therein in the case of over-production, we face dynamics that were once not a factor, such as eroding residual values. s the business jet fleet ages and pre-owned inventory increases, will pricing continue to erode? What effect will new aircraft pricing and shorter delivery times have on the pre-owned market? TLE OF CONTENTS 1-2 YTD Pre-owned Transactions & Prices Continue Down 3 round the Globe 3 Current Market Strength 3-8 Marketline Charts 9 Change of Status Charts 1 luebook t--glance 1 Into the lue 11 What s New 11 sk ircraft luebook LUEOOK-T--GLNCE JET increased 2 DECRESED 688 STLE 31 TUROPROP increased 1 DECRESED 12 STLE 57 MULTI increased DECRESED 12 STLE 575 SINGLE increased 1 DECRESED 486 STLE 2145 HELICOPTER increased DECRESED 38 STLE 197 1

2 ircraft # Sold *Price *Days on Market *Year # Sold *Price *Days on Market *Year Hawker 8XP Hawker 85XP Lear Lear 6XR Citation Sovereign Citation X Challenger Gulfstream G Falcon Challenger Falcon Gulfstream GIV Falcon 9EX Gulfstream GIVSP Global Express Gulfstream GV Global Express XRS Citation XLS Challenger Falcon 2EXy Falcon 9EXy Gulfstream G Gulfstream G Total *verages for aircraft sold. January - May 212 January - May 213 January - May 212 January - May 213 ircraft # on Market # on Market Hawker 8XP Hawker 85XP Lear Lear 6XR 13 2 Citation Sovereign Citation X Challenger Gulfstream G Falcon Challenger Falcon Gulfstream GIV Falcon 9EX 7 16 Gulfstream GIVSP Global Express Gulfstream GV Global Express XRS 9 21 Citation XLS+ n/a 12 Challenger Falcon 2EXy 21 2 Falcon 9EXy 13 9 Gulfstream G Gulfstream G Total

3 IRCRFT LUEOOK ROUND THE GLOE National usiness viation ssociation (N) nnual Meeting, Las Vegas, NV; October 22 24, 213 Founded in 1947 and based in Washington, DC, the National usiness viation ssociation (N) is the leading organization for companies that rely on general aviation aircraft to help make their businesses more efficient, productive and successful. MRKETLINE CHRTS ll of the listed aircraft have a composite score that is presented in the Used ircraft Market graph. Data points are represented in relationship to the respective new delivered historical price that is equal to 1%. The measure of change is reported in the actual percentage of value in relation to new. The delta between reporting periods can be concluded as the percentage of change. USED IRCRFT MRKET Dubai irshow, Dubai, UE; November The Dubai irshow is produced by F&E erospace - a division of F&E; one of the most influential and longstanding names in the Middle East s events sector, delivering international trade events across a variety of markets since CURRENT MRKET STRENGTH CMS represents an aircraft s current strength in the market. n + rating indicates the aircraft is enjoying a very firm market. Prices for an + aircraft are steadily rising, and holding times are very short or nonexistent. t the opposite end of the spectrum, a C- aircraft is one experiencing a very soft market. Its price is commonly discounted, and it often sets on the ramp in excess of eight months before selling. It is important to remember that Current Market Strength is not a forecast. It is valid only at Marketline s effective date of release. See chart below Current Market Strength (CMS) 27/28 Model CMS 27/28 Model CMS 27/28 Model CMS eech Premier 1 ombardier Global XRS ombardier Challenger 64 ombardier Challenger 3 ombardier LearJet 6XR ombardier Learjet 45XR Cessna Citation X Cessna Citation XLS Cessna Citation CJ3 Cessna Citation CJ2 Dassault Falcon 9EX Easy Dassault Falcon 5EX Dassault Falcon 2EX Embraer EM-135 Legacy Embraer Phenom 1 Gulfstream G55 Gulfstream G45 Gulfstream G2 Gulfstream G15 Hawker 8XP - Hawker 4XP C eech King ir 35 eech King ir 2 eech King ir C9GT Cessna 28 Grand Caravan Piaggio P18 Pilatus PC-12/47 Piper P46-5TP Meridian + Socata TM85 eech 58 aron - eech 36 onanza - Cessna T26H Stationair Cessna 182T Skylane Cessna 172S Skyhawk Cirrus SR22-G2 Cirrus SR2-G2 Diamond D4-18XLS Star Diamond D2-C1 Eclipse Mooney M2TN cclaim - Mooney M2R Ovation - Piper P46-35P Mirage Piper P34-22T Seneca V - Piper P28R-21 rrow Piper P rcher III Evektor Sportstar (LS) Flight Design CTLS (LS) gusta 19 Grand ell 26 L-4 Eurocopter S35-3 Robinson R44 Raven II Sikorsky S-76C++ 3

4 LRGE JET MEDIUM JET The Large Jet chart depicts the average price (in thousands) of the seven jets listed. Each model s year will precede the name of the aircraft. The Medium Jet chart depicts the average price (in thousands) of the six jets listed. Each model s year will precede the name of the aircraft. 26 ombardier Global Express ombardier Challenger Dassault Falcon 9 EX Easy Dassault Falcon 2EX Easy Gulfstream G Gulfstream G Embraer EM135 Legacy ombardier Challenger ombardier Lear 45XR Cessna Citation Sovereign Cessna Citation XLS Gulfstream G Hawker 8XP. 4

5 SMLL JET TUROPROP The Small Jet chart depicts the average price (in thousands) of the six jets listed. Each model s year will precede the name of the aircraft. The Turboprop chart depicts the average price (in thousands) of the seven turboprops listed. Each model s year will precede the name of the aircraft. 25 eech Premier Cessna Citation CJ Cessna 51 Mustang. 28 Embraer Phenom Embraer Phenom Hawker 4XP. 25 eech King ir eech King ir eech King irc Cessna 28 Grand Caravan Piaggio vantip Pilatus PC12/ Socata TM7C

6 SINGLE/MULTI PISTON HELICOPTER The Single/Multi-Piston chart depicts the average price (in thousands) of the 12 aircraft listed. Each model s year will precede the name of the aircraft. The Helicopter chart depicts the average price (in thousands) of the seven helicopters listed. Each model s year will precede the name of the aircraft. 25 eech 58 aron. 25 Diamond D42 Twin Star. 25 Piper P34-22T Seneca V. 25 eech 36 onanza. 25 Cessna/Columbia Cessna 182T Skylane Cessna T26H Turbo Stationair. 25 Cessna 172S Skyhawk SP. 25 Cirrus SR22-G Diamond D4-18 Star Piper P46-35P Mirage. 25 Piper P28R-21 rrow. 25 gusta 19E Power. 25 ell Eurocopter EC Eurocopter S35-3 Ecureuil. 24 Enstrom 28FX. 25 Robinson R44 Raven. 25 Sikorsky S-76C+. 6

7 LEGCY JET LEGCY PISTON The Legacy Jet chart depicts the average price (in thousands) of the eight jets listed. Each model s year will precede the name of the aircraft. Legacy ircraft are those produced prior to the year 2. The Legacy Piston chart depicts the average price (in thousands) of the ten piston aircraft listed. Each model s year will precede the name of the aircraft. Legacy ircraft are those produced prior to the year ombardier Challenger ombardier Lear Cessna Citation Ultra Dassault Falcon Dassault Falcon 5EX Gulfstream GV Gulfstream GIVSP Hawker8XP eech 36 onanza. 199 eech F33 onanza Cessna 21 Centurion II Cessna 172P Skyhawk Cessna 152 Commuter II. 199 Mooney 252 TSE. 199 Piper P Dakota Piper P-28R-21 rrow. 199 Piper P rcher II Piper P Warrior II -2. 7

8 LEGCY MULTI ENGINE PISTON NSDQ Consider these graphs as crosschecks. The general aviation and business aircraft market does not operate in a vacuum but is a part of the bigger picture The Legacy Multi Engine Piston chart depicts the average price (in thousands) of the six aircraft listed. Each model s year will precede the name of the aircraft. Legacy ircraft are those produced prior to the year eech 58P Pressurized aron. 199 eech 58 aron Cessna 421 Eagle III Cessna 31R II Piper P-31C Navajo. 199 Piper P-34-22T Seneca III. U.S. REL GDP Each data point represents the E s final figure or latest estimate of the quarter-to-quarter seasonally adjusted annual rates of change in real GDP based on chained 25 dollars. The study begins with the first quarter in

9 CHNGE OF STTUS: SINGLE/MULTI The black line in the chart depicts change-of-status data for singles. The light gray line represents multi Single: 5357 Multi: CHNGE OF STTUS: JET/TURO/HELI The black line in the chart represents change-of-status information for jets. The light gray line depicts turboprops, while the dark gray line represents helicopters. Jet: 731 Turboprop: 524 Heli: CHNGE OF STTUS: TOTL MRKET Depicts change-of-status data for all aircraft included in the ircraft luebook. The numbers are from the F Registry. Gliders, homebuilts, airliners and other aircraft not found in the luebook are not included in this study Total Market

10 INTO THE LUE ircraft luebook t-a-glance Cessna 177 Cardinal Series y Chris Reynolds, S ircraft luebook-price Digest ircraft luebook-price Digest t-a-glance has reviewed the current market status of the Cessna 177 series aircraft (not including the 177RG). Research for this study was obtained in part from ircraft luebook, ircraft luebook s Historical Value Reference, the F s registry website and various trade publications. Demand The 177 Cardinal is a four-seat, single-engine aircraft powered by Lycoming s 15 hp O-32-E2D and later the 18 hp O-36-2F for the 177 and models. The Cardinal was introduced in the late 196s as a 7 s successor to the venerable Cessna 172. Some of its defining features are a cantilever wing with a laminar flow airfoil, swept tail and canopy. The aircraft also was produced in the Retractable Gear (RG) version. The average airframe time for a model year is approximately 3,822 hours. ccording to the F s registration the 177 series (177, 177, 177) has an active fleet of approximately 1,6 aircraft, which represents about 6 percent of the aircraft originally produced. round 3 various year models (of the Non-RG Cardinal) were listed for sale in the aircraft trade publications representing approximately 2 percent of the total fleet. Pricing Current offerings for Cardinals range in asking price from $25 to $9 thousand. The average asking price for a 1974 model year is around $45 to $5 thousand. Especially with legacy aircraft, such as the Cardinal, time, equipment and condition are large contributors to value. The Summer 213 ircraft luebook lists a 1974 Cessna 177 Cardinal with a reported retail price of $39 thousand. Historical Values Using the information above as an example; a 1974 Cessna 177 Cardinal, whose ircraft luebook Historic Values are shown tracked to the fourth quarter of 1982, was reported new with a standard list price of $27,341. ircraft luebook-price Digest s Historical Value Reference has demonstrated the Cessna 177 Cardinal s market value performance by quarter in the graph for this 1974 model. Other historical values can be obtained at ircraft luebook s website, 6 VERGE RETIL VLUES (THOUSNDS) From

WHT S NEW IN Updated model information 213 Model Information SK IRCRFT LUEOOK In an effort to better explain how the ircraft luebook works, we have included a few more FQs this month that are

11 WHT S NEW IN Updated model information 213 Model Information SK IRCRFT LUEOOK In an effort to better explain how the ircraft luebook works, we have included a few more FQs this month that are relevant to all aircraft large and small. If you have any questions about the ircraft luebook-price Digest, please feel free to give the editorial staff a call at or us, info@aircraftbluebook.com. Where can I find the ircraft Spec Charts and other information formerly in print? This content is available for free at com under the Supplemental Data Tab and includes: irworthiness Directives, Engines, Manufacturers, Specifications, Fixed Wing Specifications in PDF format, Glossary of Terms and bbreviations, Interest Charts and rea Codes. Do you have a printed copy of the Historical Value Reference? No, it is only available online at com as both a singular subscription or as part of a combination subscription to ircraft luebook. MEET THE STFF Frank Craven, Publisher Frank.Craven@penton.com Carl Janssens, S Chief ppraiser Carl@jetappraisals.com Chris Reynolds, S ssociate Editor/ppraiser Chris.Reynolds@aircraftbluebook.com Paul Wyatt, Consulting Editor Paul.Wyatt@penton.com

2012 NEWSLETTER BLUEBOOK PERSPECTIVES FACING THE NATION By Carl Janssens, ASA Editor and Chief Appraiser

2012 NEWSLETTER BLUEBOOK PERSPECTIVES FACING THE NATION By Carl Janssens, ASA Editor and Chief Appraiser MRKETLINE VOL 25 NO 4 212 NEWSLETTER LUEOOK PERSPECTIVES FCING THE NTION y Carl Janssens, S Editor and Chief ppraiser It is all said and done. new leader has been chosen. The challenges of this executive