Asian Sky Quarterly 2021Q1

PRE-OWNED MARKET SPOTLIGHT: GLOBAL XRS & GLOBAL 6000
Based on ASG’s market records, since 2017 the Global XRS’s average
asking price has decreased from $20 million to around $15 million
today – around a 25% decrease over four years. The price trend also
shows that the asking values for the Global XRS and Global 6000 have
been consistently below that of its competitors, the G550 and Falcon
7X, making it a viable option among price sensitive operators. Over the
past three years, and taking into account the natural aging of the Global
6000 fleet, its average asking price trend varied from $35-$40 million, to
the $25-$30 million price range that it is currently.
The average time to sell a Global XRS / 6000 takes from six months to
one year - a bit longer than G550 which is usually five to ten months.
However, any transaction depends on the aircraft’s age, configuration,
equipment, and maintenance status. So the time on market could be longer,
or shorter.
Over 70% of the current fleet (both XRS and 6000) for sale are enrolled
on an engine maintenance program, with nearly all recent transactions
also being enrolled.
ULTRA LONG RANGE MARKET - AVERAGE ASKING PRICES (GLOBAL 6000 & XRS VS. G550 & FALCON 7X)
GL6000
GL XRS
G550
F7X
Avg Asking Price
Average Asking Price Million USD
40
35
30
25
20
15
10
Mar21
Jan21
Nov20
Sep20
Jul20
May20
Mar20
Jan20
Nov19
Sep19
Jul19
May19
Mar19
Jan19
Nov18
Sep18
Jul18
May18
Mar18
Jan18
Nov17
Sep17
Jul17
May17
Mar17
Residual Value and Pricing Strategy
Forecast for Global XRS / Global 6000
According to Vref, for a 2015 delivered Global 6000 with a residual value
between $20-$23 million, the annual depreciation rate will be over
10%. For a 2010 Global XRS, its current residual value varies between
$12.8–$14.5 million, with an annual depreciation rate of around 7%.
From what we have seen in the market, sellers / owners expectations
for selling Global’s are often high and far from the market reality. We
have seen many XRS / 6000 listed on market with a high asking price
but no solid enquiry / lead for a long time. Eventually the owner/seller
has to reduce the pricing by millions – In many cases we have seen
a reduction in asking price of between $4-$5 million over the course
of a year.
The fourth quarter of 2020 saw a surge in activity that capped off an
already very active year for Global transactions. With business aviation
in recovery, it is foreseeable that the demand for the Global 6000
and XRS will remain strong. But in the long run, the Global XRS and
Global 6000 market supply will continue to increase, which will have
a negative impact on pricing.
FIRST QUARTER 2021 — ASIAN SKY QUARTERLY | 43