Jetrader - September/October 2013 - 47

appraisal

A319
Oliver Stuart-Menteth
ISTAT Senior Certified Appraiser
Managing Director
Fintech Aviation Services Sarl
Tel: + 41 22 548 1707
oliverstuart@fintech.aero

Background

Chart 2

The A319-100 was launched in 1993
on the back of orders from ILFC. Since
the ﬁrst deliveries in 1996, the series has
accumulated, as of 30 June, 1,519 orders
and 1,371 deliveries. The aircraft was the
third model of the narrowbody family to
be offered and initially proved extremely
popular with ﬂag carriers and later with
low cost carriers. Offered with either the
CFM56 or V2500 power plants, Chart 1
illustrates the current respective market
shares between the two manufacturers. A
Long-Range (LR) version is also available,
although this has only been ordered by a
handful of operators, mostly from the Middle
East, who use the aircraft to initiate thin
medium-range routes. There are currently
129 operators/owners of the aircraft though
the largest 13 operators account for more
than 50 percent of the ﬂeet population.

Source: Jet Information Services

Chart 2 illustrates that the aircraft has
proven to be extremely popular within the
European short-haul sector, though less so
in Asia where demand has forced operators
to utilize larger A320 and Boeing 737-800
aircraft. Easyjet, who currently operates 140
A319 aircraft, all powered by CFM, took delivery of aircraft equipped with an additional
pair of over-wing exit doors, permitting a
rise in the maximum certiﬁed seating from
145 (EASA TC) to 160 passengers (EASA TC).

Chart 1

Current and Future Market Outlook

Source: Jet Information Services

Airbus has witnessed a protracted
decline in demand for the A319 as operators consolidate their schedules and seek
larger capacity aircraft. Against a backdrop
of average worldwide revenue passenger
kilometer (RPK) growth (year over year
May 2013) of 5.6 percent, gross orders for
the aircraft have slowed considerably with
2010 (43), 2011 (4) and 2012 (33) reﬂecting the stagnating market serviced by this

130- to 155-seat aircraft. Up to 30 June,
Airbus has recorded only one order but
received cancellations for eight.
Since 2008, values for the A319 have
remained below base but over the past
18 months, the type has witnessed a marked
reduction. Within the A319 market itself,
demand is notably higher for the double
over-wing exit equipped aircraft, which as  of
1 March, accounted for approximately 20 percent of the ﬂeet. Purchase offers in the used
market for relatively young aircraft are consistently below book values, creating an impasse
and leading to trading stagnation when losses
cannot be absorbed. Lease rates are under
severe pressure. There is, understandably, considerable focus on forecasted values of A320ceo
(current engine option) family variants over the
next 10 years given the proposed introduction
of the A319neo (new engine option) in early
2016. Depreciation proﬁles of those A319ceo
aircraft built within two years of the production line terminating will, in our opinion,
be markedly different to that shown for a
mid-line production aircraft. However, unlike
the A320neo, there has been relatively little
appetite for the more fuel-efﬁcient variant,
and we would therefore expect to see (barring
any future large-scale orders) the residuals of
A319 ceo to be relatively un-affected by the
introduction of the A319neo. As at the end
of second quarter 2013, four aircraft had been
parted out and 24 were in storage.

Chart 3
DOM
1998
2000
2002
2004
2006
2008
2010
2012

CMV
2013
10.45
12.50
14.57
16.67
18.78
20.92
24.19
30.44

BV
2013
10.92
13.25
16.62
20.56
24.61
28.57
32.87
37.51

2014
10.17
12.40
15.29
19.03
23.37
27.26
31.50
36.08

Current and Future Value Opinions, $millions
Future Base Values, Inflated at 2.5% per year
2015
2016
2017
2018
2019
2020
9.44
8.80
8.15
7.43
6.91
6.40
11.56
10.86
10.09
9.21
8.55
7.90
14.02
13.24
12.36
11.34
10.55
9.77
17.56
16.29
14.95
13.82
12.92
12.01
21.70
20.21
18.67
17.03
15.64
14.62
25.95
24.76
23.00
21.17
19.55
17.99
30.12
28.81
27.43
25.98
24.13
22.33
34.63
33.21
31.75
30.27
28.82
27.38

2021
5.95
7.30
9.03
11.14
13.63
16.49
20.61
25.42

2022
5.56
6.75
8.34
10.31
12.67
15.42
18.96
23.53

Engines: CFM56-5B5/P (non-DAC), MTOW 70,000 kg, 2-class seating, single over-wing exit
Base values take into account country imposed age related restrictions and do not therefore comply with the ISTAT definition.
Base and CMV figures reflect better-than-half-life maintenance status for aircraft less than four years old.
The aircraft values stated herein are the product and the property of independent third-party sources, and ISTAT neither approves nor endorses the information
contained herein or the use thereof for any purpose whatsoever.
Jetrader • September/October 2013 47
Jetrader - September/October 2013

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