The Beechjet first came into business aviation when Beechcraft purchased the design of the Diamond II from Mitsubishi. The Beechjet 400A started production in 1989 and was first certified in early 1990; over the following 23 years 353 aircraft were produced. The aircraft was an improvement of the Diamond II in Avionics, Engines, Performance, and a higher gross weight.
In 2003 Raytheon aircraft began to manufacturer the Hawker 400XP that offered a number of features that were not standard on the 400A. These features included: 200lb gross weight increase, a nine passenger seating arrangement, thrust reversers, TCAS II, and an ELT. The aircraft was produced for the next 7 years and 251 aircraft were produced.
Both aircraft are powered by the Pratt & Whitney J15D-5 engines turbo fan engines. Each engine produces 2,900 lbs of thrust and has inspection intervals of 3,500 hours. When you combine these engines with the unique airframe design, it allows the aircraft to travel 1,500 nm at a speed of Mach .78 – another improvement from the original Diamond II.
These aircrafts come standard with Pro Line 4 avionics, and the 400A was the first aircraft to be certified with such an advanced cockpit. The cockpit includes: a digital flight control system, flight management system, single multifunction display, color weather radar, and an improved Collins Radio altimeter.
The aircraft also boasted an upgraded cabin that is the largest in its class, and is richly appointed similar to its ‘Big Brother’ the mid size Hawker 800XP.
The foregoing features, namely the logical and well-designed layout of the avionic suite, and the stable and reliable performance during flight, represent the biggest strengths for the aircrafts. These features make the 400A an excellent option in its class and a viable choice for a private operator r a company looking for an efficient light jet. Further, the 400A was the basis for the military trainer T-1 Jayhawk, which 181 were produced. The Japanese Government also purchase over a dozen for special mission programs. The aircraft also received new life when Nextant Aerospace, who is under the corporate umbrella of Directional Capital owned by Ken Ricci, developed a program to remanufacture the 400A/400XP. This program involved hanging new Williams engines and upgrading the cockpit to a Pro Line 21 avionics suite.
The Beechjet 400A / 400XP markets have been very active in the last couple of years. The light jet market in the United States has been strong, and due to the attributes above, the aircraft continues to be a reliable option for the category.
There are currently 44 Beechjet 400As and 20 Hawker 400XPs, attributing to 14% and 8.33%, respectively, of the active fleet. The Beechjet percentage is higher than average for the rest of the market, but both are considered in a buyer’s market due to rising levels of inventory and decreasing price points. The average asking price for the combined markets is between $500,000 and $2,950,000.
Over the past two years we have seen a steady number of transactions for both aircraft. Specifically, the Beechjet 400A had 49 transactions in 2014 and 35 transactions in 2015. The Hawker 400XP has had a more difficult time, with 32 transactions in 2014, and a drop to 18 transactions in 2015. It is difficult to explain why there was such a decrease over the last year, as the Vref values outlined below show only an insignificant decrease. These two aircraft are different from other categories in that the engine maintenance program is not a big factor in pricing. However this is offset by the amount of time until major inspections are due on the engines. Specifically, such major inspections are the Hot Sections Inspections and when the engines need to be Overhauled. Other key factors are the total airframe time for the aircraft, and numerous avionics upgrades, as well as the condition of the Paint and Interior. The transactions for the aircraft have ranged from $700,000 – $2,400,000.
Notable Recent Transactions
Below are some recent transactions numbers that provide a brief view of where these airplanes are trading, along with the current Vref trend of the average retail value for the aircraft, by model year, compared to the sales prices:
Vref Trends for the Aircraft
Above is the comparison for each aircraft, comparing the retail values from Q4 of 2014 and 2015. Consistently throughout both markets we have seen a drop of $50,000 – $100,000 for each model year. As I mentioned above you can see from the two key transactions that the 400A has held its value better of the last year, the 400XP on the other hand is struggling to meet full retail value. We have been seeing these aircraft trade below 90% of full retail, these trades can be seen by the triangles represented on the graph. This is surprising as Textron has started to support Hawker Beechcraft products over the last two years, but a stigma left by the bankruptcy is still hurting overall value of the aircraft. As mentioned above, this presents a significant opportunity for buyers to be patient and find the best value. For Sellers, this means they need to be realistic about what their aircraft is worth and take the first reasonable offer instead of continuing to chase the market down.
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