As a four-engine aircraft, the 747-400's fate is especially tied to fuel costs; many airlines prefer the twin-engine Airbus A330-300 as an alternative, and Boeing's 787 also could push some of them out early. In van Leeuwen's figures for valuation of 10-year-old aircraft, some of the steepest declines in the past year show up for -400s, with a drop that exceeds 20%.
Airbus A340-300: This four-engine aircraft, powered by CFM56-5C4/Ps, shows up with the biggest market value decline in the past year at 10 years of age in van Leeuwen's numbers—more than 30%.
A few years ago, Geach says, the A340-300 could be sold in the high $20 million or low $30 million range. But in addition to the four-engine handicap, values began to tumble after late 2011 when Airbus announced the end of its production. With carriers such as Lufthansa and Swiss International Air Lines expected to retire them in considerable quantities in coming years, the selling price is expected to drop below $10 million, he says.
Bombardier CRJ100/200s and ERJ 135/145: It is no secret that the smaller regional jets, and the 50-seaters in particular, have fallen far out of favor in the U.S. because fuel costs have made them uneconomical on many routes. That is already showing up in higher retirement rates at young ages for the CRJs, and in valuations for the ERJs.
The ERJ retirements are just beginning, but could be exacerbated because Rolls-Royce exercises more control over the secondhand market for its engines than General Electric, which powers the CRJs with CF34-3As and -3Bs. Rolls selectively licenses its engine overhaul work and restricts an overhaul company's choice of parts suppliers, which can make engine maintenance more expensive for potential ERJ leasers or acquirers. Rolls, in response, says its TotalCare agreements provide predictability in costs and on-wing performance for the AE 3007 turbofans.
What does the future hold for retirements? AWIN's forecast sees a handful of aircraft models retiring in significant numbers at average ages under 25 over the next five years, including the small regional jets, the A340-200/-300, A320 and 747-400.