What drives business aircraft depreciation … and why each model is different

What if two jets of the same age, bought in the same year, lost value at wildly different rates? That is not a hypothetical. Our analysis of over 3,000 secondary-market transactions across midsize and super-midsize model families reveals that depreciation varies far more across models than most buyers expect. The Gap Is Real, and It Compounds Two buyers each write a check for $12 million on a super-mid in 2022. Same cabin class, same mission, same market. One model depreciates at 4.6% per year, the other at 6.2%. That 1.6% difference sounds small, but watch it compound. Both aircraft were purchased for $12M in 2022. After seven years, the slower depreciator is worth $1M more than the faster one, and the gap keeps widening. A difference that looked negligible at signing becomes a six-figure penalty by mid-hold and a seven-figure one at exit. Many aircraft loans include a balloon payment sized to an assumed residual value. If the model depreciates faster than that generic assumption, the owner ends up underwater at maturity: selling won't cover the note. What Separates a Slow Depreciator from a Fast One Each model family sits on its own depreciation curve, shaped by structural factors set long before any individual transaction takes place, and largely independent of the supply and demand swings that move the market as a whole. Starting price and mission value. New aircraft pricing sets the ceiling for early-year values. Models that launched at a premium relative to their cabin class and mission capability tend to correct faster in the secondary market as buyers weigh what they actually get for the money. Fleet size and market liquidity. When there are hundreds of a given model in service, it becomes a known quantity. More MRO shops service it, parts are readily available and type ratings are offered at multiple training centers. These factors play into resale pricing; they lower operating risk and keep transaction volume high enough for a liquid secondary market. A smaller fleet doesn't necessarily mean a worse aircraft, but it does mean fewer service options, fewer qualified buyers and wider bid-ask spreads at exit. Main operating factors: fuel, program andamp; maintenance costs. Fuel burn and hourly maintenance program enrollment differ meaningfully across models in the same cabin class. Not all buyers weigh these costs at acquisition, but the secondary market does. There will always be a larger pool of buyers for the aircraft that costs less to operate. Meanwhile, the more expensive models accumulate supply as owners exit, further depressing their resale values. New-model introductions. When a manufacturer launches a successor variant, the previous generation sees an accelerated decline as buyers shift their attention, along with their budgets, to the newer airframe. The older model doesn't stop flying, but its pool of prospective buyers shrinks, and that thinner demand shows up in transaction prices, especially once the successors hit the secondary market. Institutional fleet turnover. Some markets are permanently under selling pressure from large operators cycling through fleet refreshes, depressing prices across the entire model fleet. It takes a data-savvy brokerage to identify these patterns and separate structural depreciation from supply-driven pricing. Market Cycles Shift the Level, Not the Ranking Buyer and seller demand push jet price levels up and down with the cycle, but the relative differences between models persist. A slow depreciator in a hot market is still a slow depreciator in a soft one. The cycle shifts the entire fleet up or down; it does not reshuffle the ranking. The 2020 to 2022 period compressed depreciation spreads as demand surged across all model types. The subsequent corrections widened them again, and in some cases overshot historical norms. Whether the current spread persists remains to be seen, but it has real implications for anyone modeling a five-year hold today. What the Owner Controls The factors above are structural, set by the market before any individual owner enters the picture. Beyond choosing the right aircraft for your ownership profile from the get-go, keeping it up to date with maintenance, two owner-level decisions have an outsized impact on residual value. Utilization. Putting an aircraft on a charter certificate can offset fixed costs (hangar, insurance, management fees), and for a lightly flown owner, that math can work. But every hour flown compresses residual value, whether through higher maintenance exposure, broader inspection scope or simply the number on the logbook. Owners who charter or fly excessively need to quantify that trade-off, not assume it nets out. Pricing discipline at exit. A listing priced even slightly above the current fair-value curve doesn't just sit; it falls further behind each quarter as the market depreciates underneath it. The listing misses the window and then chases a declining target, sitting on the market for months while carrying costs accumulate. What began as a modest overshoot compounds into a sale below where the market was when the listing first went live. The Bottom Line Model, market cycle, utilization and pricing discipline all interact to determine how fast value erodes. A sophisticated buyer accounts for all of them, not just acquisition cost. A slightly more expensive aircraft with a slower depreciation rate and lower hourly costs can deliver significantly better total economics over a five- to seven-year hold. On the sell side, your model's depreciation curve, not an industry average, should set the listing price. Data-driven analysis, not rules of thumb, should guide every transaction. Insights derived from Guardian Jet's proprietary transaction database covering midsize and super-midsize aircraft aged 3 to 15 years. Levente György is a consultant at Guardian Jet, specializing in asset management analytics, fleet planning and aircraft residual value modeling.