A look back at the helicopter industry in the late 70’s finds the first oil crisis had just passed but was still fresh in our minds. Little did we know that just around the corner U.S. gasoline was going to spike over one dollar a gallon. Bristow and PHI were well-established as the largest helicopter operators in the world, and Roy Morgan was just getting ready to found the first air medical helicopter operation, Rocky Mountain Helicopters. The majority of helicopters at that time were used in utility and offshore oil support, turbine engines had edged out pistons in popularity, and the ubiquitous JetRanger was approaching 3,000 units in use globally.
In 1978, a helicopter broker had a line on half a dozen JetRangers at a fabulous price. Instead of brokering the deal, he decided he wanted to buy them outright and sell at a profit. He asked the bank to loan him the money. The bank used a fixed-wing bluebook to value the JetRangers and subsequently declined the proposition. The broker brought back to his office the concept of a new helicopters only blue book dedicated to correcting the inaccuracies of existing sources, which didn’t understand or reflect the higher than average values sustained by helicopters due to their nature of constant component replacement and overhauls. The next year was spent compiling sales data as well as operating and overhaul costs from OEMs, large maintenance shops, and operators. As a result, the first edition of The Official Helicopter Blue Book® was published in 1979.
Within a few years, PHI, Inc.’s lender called upon the Blue Book to perform a fleet evaluation. Barry Desfor, then General Manager, agreed to take on the project. Through the process of compiling data for the Blue Book, Barry had a thorough understanding of what drives helicopter sales prices. Barry used this knowledge and data to develop a series of formulas that measure the relative component status of multiple helicopters resulting in the first helicopter appraisal.
During that same time period, Richard Santulli had begun to use the U.S. Investment Tax Credit to generate interest among private investors to create RTS Helicopter Leasing – the first helicopter-dedicated leasing company. RTS needed a timeline on projected values over the life of the lease, so Barry created the formulas for residual value projections.
The Blue Book business continued to grow, writing more appraisals every year until 1990, when Barry’s close friend, Ralph Rosenbrock, suggested that the component TBOs and pricing were awfully minimal. Barry invited Ralph to join a new endeavor to create a companion book, Helicopter Equipment Lists & Prices (HELP) ™, which quadrupled the number of components covered and, simultaneously improved the helicopter appraisal spreadsheets immensely.
The 21st century brought new challenges with ever increasing changes in financial regulations, including the 2002 Sarbanes-Oxley Act, impacting financial institutions and the appraisal industry with new requirements. In 2005, these new regulations prompted us to send our first appraiser to become certified by the American Society of Appraisers, bringing even greater integrity, regulatory-approved appraisal methodologies, and reports.
Today, the landscape of the industry looks significantly different than in previous decades. The offshore oil and gas market is a driving force of helicopter values. EMS operations now account for a large percentage of the market. The introduction of major lessors has changed the financing landscape completely and has had a notable impact on the sales of heavy and medium class helicopters.
The Official Helicopter Blue Book® is now a completely online resource that covers the specifications, manufacturer pricing, current and historical resale values, and hourly maintenance costs for over 200 civilian and restricted helicopter models. Today, HeliValue$ is still the only helicopter-dedicated appraisal firm in the world, and perform an average of 2,500 helicopter appraisals annually.
HeliValue$ continues to expand its staff, and technology, keeping a close eye on the future and its constantly fluctuating markets in order to continue to provide the most accurate and dependable Blue Book resale values and appraisals to operators, lessors, and financial institutions worldwide.
Copyright HeliValue$, Inc. 2020