23
May
Bizjet recovery??
Author: mgiles | Category:
Business Aviation
Recovery Is in Sight, Say Bizjet Makers at Ebace
Their production slowed, workforces slashed, products and reputations besmirched,
and giddy forecasts turned into fiction, the battered and bruised makers of
business aircraft are beginning to express cautious optimism that the current
market downturn may be changing direction.
Hopeful signs include some sales of large-cabin aircraft and increased interest in
general aviation models, says Gulfstream Aerospace President Joe Lombardo, who was
among the many industry executives gathering at the European Business Aviation
Convention and Exhibition (Ebace) here last week. Compared to February, which saw a
steady stream of order cancellations and deferrals, Lombardo says, “anything is
better.”
“This crisis is much deeper than any of us had expected,” admits Dassault Aviation
Chairman Charles Edelstenne, but he insists, “all is not doom and gloom.” He notes,
for example, that the number of used Falcons on the market “seems to have
stabilized,” declining below 160 in March and April. “Clearly, things are leveling
off,” he says.
“It’s been a tough go at Cessna these past few months,” concedes Cessna Chairman,
President and CEO Jack Pelton, “but the worst is behind us.” He says recent
economic indicators are encouraging and predicts the used aircraft inventory will
peak and the drop-off in flight activity will cease by the third quarter of this
year. The company will deliver some 300 Citations this year and, while that
compares unfavorably with the 467 delivered in 2008, it “would be cause for
celebration” in any other year, he says. Meanwhile, the Wichita, Kan.-based
aircraft maker will deliver a record number of turboprop Caravans in 2009.
Nicholas Chabbert, senior vice president of general aviation for Daher-Socata,
which produces the TBM single-engine business turboprop, says his company expects
to deliver nearly the same number of aircraft as in 2008, a performance “much
better than we could have anticipated.”
The used aircraft market is stabilizing, agrees Luis Carlos Affonso, senior vice
president for executive aircraft at Embraer, which expects new aircraft sales to
recover by 2011. And while the Brazilian original equipment manufacturer revised
downward its 10-year forecast for executive jet deliveries to 10,990 from 13,000,
that lowered rate is still near the industry’s peak and represents $188 billion in
cumulative sales.
Though the environment is definitely “challenging,” says Bob Horner, senior vice
president for Bombardier Business Aircraft, the Learjet 85 is moving forward and
the company has solid cash reserves that should help it ride out the crisis.
A part of the collective, if tentative, optimism stems from an initiative that took
place in Washington early this month to gain support for the business aviation
industry among members of Congress and the Obama administration, both of which have
criticized business jet use in recent months. The chill from those remarks, plus
the economic downturn, has resulted in the loss of 15,000 manufacturing jobs,
according to the General Aviation Manufacturers Assn. (GAMA), and could do lasting
damage if not reversed.
It was under GAMA’s banner that scores of manufacturing executives, divided into 10
groups, participated in 66 meetings with legislators and their staffs in the
Capitol May 6. U.S. Transportation Secretary Ray LaHood addressed the group, and
Pelton and Lombardo were invited to the White House to speak with a presidential
aide about business aviation’s concerns. Lombardo describes the meeting as “very
productive,” and says he and Pelton extended an invitation to anyone at the White
House to visit Wichita or Savannah, Ga., or any other center of general aviation
jobs.
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