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Introduction

Richard Anderson, CEO, Delta Air Lines. Photo via Google images.

Delta Air Lines CEO Richard Anderson is right.

Actual market values for 10-year old Boeing 777-200ERs are around $10m, not the $50m-ish suggested by Boeing and professional appraisal firms.

This is the conclusion of our Market Intelligence of real-world demand for these airplanes, not some theoretical book appraisal.

Furthermore, used 777-300ERs are in little demand.

The costs involved in reconfiguration and maintenance, repair and overhaul (MRO) simply upend traditional expectations.

Summary

• Used 777-200ERs can’t be “given away,” reducing values to scrap regardless of book values carried by owners or appraisers.
• Rolls-Royce-powered -200ERs, caught up in RR maintenance programs, make traditional engine valuations irrelevant.
• A sudden glut of late-model 77-300ERs upend these values.
• Ten year old -300ER lease renewal rates demanded by airlines drop to $325,000 in negotiations.