Gulfstream G650 and G550 Market Status
Gulfstream G650 Status
It appears that the G650 market is about to take its first step below the $50MM asking price level (note, we stated asking price…not selling price). Probably no surprises there, given the continued slide in bizjet prices. However this particular 2012 model, delivered in 2013, will probably need a significant dip below the $50MM mark in order to sell. There are numerous reasons for this subjective assesssment, among which are its current technical condition and this G650’s provenance.
Another G650 2013 model also came to market this past week and is hoping to avoid a sub-$50MM sale price. However, we believe that market pressure will eventually suck the selling price below the $50MM mark, especially since there is no program on the engines. The seller’s agent suggested to us that this is ‘merely a financial calculation‘…ie., price reduction. This is far from the reality of the sale situation because there is significant risk involved when assessing the condition of these engines and the seller must consider the fact that circa 90% of the G650 fleet has some combination of engine/APU and Plane Parts coverage…those aircraft that are not fully covered, by definition, pay a penalty in terms of time on market and eventual selling price.
So now we’re up to twelve G650’s listed for sale, with two under contract and about to start the inspection process. Incidentally, one of these G650 sellers has managed to convince a buyer to proceed with a closing using only a minimal inspection process. This is a foolish risk to take, (on the part of the buyer) and the buyer may come to regret this decision.
Gulfstream G550 Status
This is most definitely a tale of a steep downward price spiral. Given that Gulfstream just announced the soon-to-be demise of the G450 production line in anticipation of the G500 entry-to-service, the G550 will surely follow when to G600 nears full development and production. This will hasten the downward price movement of the G550’s. It seems almost unreal that these aircraft are fast approaching the ‘low teens’ for actual sale prices. Detailed price/condition/vintage evaluation is beyond the scope of this blog, but suffice to say that this is truly a buyers’ market, although sound guidance is needed when venturing in.
There are roughly forty G550’s for sale (including the usual handful of off-market aircraft) and we suspect that actual selling prices are at a significant negative delta to asking prices. Aviatrade has recently investigated the G550 market availability and we are regularly offered ‘great deals’ for all vintages of G550.
Aviatrade’s advice is to look for the G550’s that are equipped with all of the Nextgen avionics and thereby secure a sizable discount on the installation/unit costs of ADS-B Out, CPDLC, etc.