Thursday, June 11, 1998 Air Transport and General Aviation Auction

Where do veteran jetliners go for a new lease on life? Some go to the highest bidder.

A Tulsa, Oklahoma-based company called Tradedays International auctions off used airplanes--everything from small commuter planes to the largest commercial jet transports. Up for sale at its next transport auction June 11 are jets with world-famous names that will cause hearts all over the new Boeing Company to beat faster--names like DC-8, 727, DC-9, and DC-10.

There may even be a 747 or two, said Hal McClure, senior vice president of Tradedays.

The company was started a year ago as a way for people in the commercial aviation industry to gather once a month and trade ideas and equipment, McClure said. Auctions happen every month, but transport auctions are once every three months--they've had two so far--and next month's event is the first time they've heavily publicized the big jets.

If past events are any indication, McClure said he expects a good turnout.

Tradedays receives airplanes, engines and accessories on consignment and takes a 1-2 percent commission from the seller once they are sold. Dealers/brokers with exclusive listings pay no commission to sell. However, all buyers pay a 1 percent buyer's premium commission. Sellers can avoid signing a 30-day exclusive listing and paying a Seller' registrtion fee for auction purposes by advertising their aircraft in an aircraft daily, weekly or monthly publication prior to the June 11 auction date, indicating they are willing to accept a final sale and/or a 6-day option to sell at their minimum price in the auction. Buyers and sellers come from all over the world--some airplane people, many air cargo companies, and a few individuals.

The bigger jets that commonly make their way onto the auction block date from early ?60s DC-8s all the way up to equipment that's only a few years old. The auction is growing daily, and is receiving a good response from national and international press and expect the auction to total over $200 million in sales. Additional transport equipment is being added each week.

On Thursday, June 11, beginning at 11:00 a.m., prospective buyers can inspect the airplanes on the Tulsa Airport tarmac before hand, McClure said, but the actual bidding happens in a room at the Radisson Hotel near the airport. Bidders are shown a two-minute video about the airplane up for sale, and the bidding begins.

Also on Friday, June 12, there will be a general aviation auction at the Wiley Post Airport in Oklahoma City, Oklahoma

"We probably sell about 25 percent of the airplanes that day," McClure explained, "but others which do not reach the seller's minimum selling price, a six-day option is immediately reauctioned at the seller's minimum selling price, which allows the buyer to personally have time to inspect the aircraft as to airworthiness directives, compliance, engine times, airframe times and other important considerations. The option process increases our sale ratios to 75 percent batting average for sale finalizations." (The option is very similar to taking an option on real estate as is the buyer loses the option money if he does not finalize the sale at the seller's minimum selling price; however, option money is applied to the purchase price when the sale is finalized. Also, the auction option process is applied to large accessories such as aircraft engines.)

McClure didn't want to talk prices--that's up to the buyers, he said. "The only way to see what these things are worth is to get five or six bidders in a room together and let them decide."