EBACE Show News - May 20, 2008 - (Page 12) EBACE 2008 U.S. Business Jet Market Shows Some Softening, But New Markets Thrive A Wall Street analyst is starting to see signs of softening in the business jet market, but remains optimistic that any downturn will be buffered by new demand from markets outside the U.S. JP Morgan’s Joe Nadol says the number of used business jets for sale has reached 7.2% of the active fleet, up from 6.8% in March and 6.2% in January. The rise was driven by higher inventories of medium and light aircraft. “We have been expecting the used market to weaken due to the soft economy in the U.S. and Europe, and the data is beginning to bear this out,” Nadol wrote in a recent report to clients. The average asking price for used jets has fallen 1% since March, to $16 million, but is still 2.6% higher than a year ago. Prices for medium business jets have declined the most since March, 2.1%, while heavy jets were down just 0.5%. The big question is how much the sputtering U.S. economy will cool off record demand for business jets. The recent emergence of markets in places such as Asia, Eastern Europe and Russia has decreased the industry’s vulnerability to swings in the U.S. economy. North American operators, which used to make up nearly 80% of demand, are expected to account for just half of the business jet purchases over the next five years, according to a Honeywell forecast released last fall. “With U.S. corporate growth likely to decline in at least the first half of 2008, we believe that at least a slowdown in business jet delivery growth could occur in 2009 or 2010,” says Nadol. However, the size of the impact will depend on how much U.S. economic doldrums impact other nations. “As we see the global economy remaining relatively strong, we believe that continuing demand from emerging markets will likely mute the effect somewhat.” –Aviation Week & Space Technology Rolls-Royce Completes First Run of BR725 Rolls-Royce (Booth 647) has successfully completed the first run of its 16,100-pounds-thrust BR725 engine at its facility in Dahlewitz, Germany. The engine will power the new Gulfstream G650. Dr. Rainer Hönig, R-R’s project director, BR725 and Future Programs, Corporate & Regional Engines, said, “The engine powered up first time and attained 80% of its full thrust rating. It is demonstrating full functionality and is performing in line with targets set in the early stages of the program two years ago.” The engine that performed the first run is one of five to be used in ground testing, while a further eight are earmarked for flight testing. Raisbeck Units Certified for King Airs Raisbeck Engineering (Booth 367) has received certification for its Crown Wing Locker Systems and Dual Aft Body Strakes performance systems for the latest aircraft in the King Air family, the B200GT and C90GTi. All Raisbeck systems are optional on Hawker Beechcraft’s new production aircraft, and Raisbeck’s engineers are in Wichita, Kansas, coordinating installation of various systems on the B200GT and C90GTi production lines. To date, nearly 60% of the King Air 200 series is equipped with one or more Raisbeck systems. Rosen Partners With AeroTecs NV for IFE Rosen Aviation (Booth 1016) has inked an agreement with AeroT NV ecs of Belgium for representation of its inflight entertainment systems to European OEMs and completion centers. Rosen has grown substantially in the U.S. in recent years and hopes to match this growth in Europe. “Although we are a very strong supplier to U.S.-based OEMs and service/modifications centers, we seek to strengthen our presence in Europe, where sales of light and very light jet applications are growing,” said Rosen President Darren Sparks. Thielert Bankruptcy Slows Diesel Skyhawk The bankruptcy of the Thielert diesel engine company has forced Cessna to cancel all planned deliveries this year of its Skyhawk Turbo Diesel four-seat propeller aircraft “but as best we can we will continue with certification of the engine installation,” Cessna chairman, president & CEO Jack Pelton told Show News. “We’re hoping that somebody buys it and starts production again.” There is a need in many parts of the world for a heavy fuel training aircraft because 100 low-lead fuel is increasingly unavailable. Cessna Wants a Low-Powered Turboprop So just what is Cessna planning as a replacement for its 172, 182 and 206 models? Over the last couple of years it has shown its high-wing, composite NGP concept aircraft, which was designed to compete head to head against the Cirrus and Columbia. But with Cessna’s acquisition of Columbia the NGP is being re-thought. Interestingly enough Cessna recently began referring to the NGP as the Next Generation Propeller aircraft, whereas earlier it called it the Next Generation Piston aircraft. Does this subtle shift suggest a turboprop is in the offing? “We confuse ourselves on that,” Cessna chairman, president & CEO Jack Pelton told Show News. “I would like it not to be a piston but right now in the near term the only powerplants available currently do have pistons.” Bombardier Challenger Continues to Fly High Don’t look for Bombardier (Booth 7521) to come up with a Challenger replacement soon. Although the Canadian manufacturer remains cagey about future sales prospects (it delivered 35 Challenger 604/605s last year and 29 604s in ’06), a recent press release from GE Aviation forecasts delivery of 1,000 CF34 engines for business jets by 2018. As only Bombardier uses the CF34 for business jets, that translates into 50 Challengers a year for the next 10 years—including the increasingly popular Challenger 850/870/890 derivative of the 50/70-passenger regional jet (12 were delivered in 2007, and three in ’06). A Challenger 604 is shown here. 7X is among the jets making a world market splash. 12 May 20, 2008 www.aviationweek.com/shownews http://www.aviationweek.com/shownews
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