A key market indicator for demand for new business jets is the number of used aircraft on the market. And that’s not a pretty picture.
The number of used business jets on the market has been building steadily since late 2007. In December, the number rose 2 percent, UBS analyst David Strauss said in a newly-released report. It’s now up 65 percent from a year ago, Strauss said.
Used aircraft for sale make up 16 percent of the in-service fleet and is approaching the 17 percent peak in late 2002. The increase is led by aircraft newer than 10 years old. Inventories of newer planes are already well above prior peak levels, the report said.
Delivery positions of new planes offered by planemakers continue to increase. They’re five times higher than prior years. There is a building number of delivery slots available for popular aircraft such as Cessna’s Citation XLS, the CJ3 and Sovereign, Bombardier’s Challenger 300 and 605 and Gulfstream’s G-450 and 550, the report said. The recent surge in listings reflects reduced customer demand and difficult financing situations, the report said.
The increase in planes for sale and a decline in flight activity leads Strauss to think that there will be a significant slowing in new aircraft demand.
Regional fractional ownership company Executive AirShare has added a sixth market — Oklahoma City — to its service base, the company said.
The company, founded in Wichita and headquartered in Kansas City, will base a Beechcraft King Air C90B at Wiley Post Airport in Bethany, Okla. The company currently serves customers in Tulsa, Dallas, Fort Worth, Wichita and Kansas City, it said. In the past two years, the company has more than doubled its number of pilots and have more than 80 clients who have purchased shares of aircraft.
Executive AirShare operates a fleet of 15 aircraft. It also operates a repair station in Wichita.
The weakened economy is taking its toll on Cessna Aircraft competitor Cirrus Design Corp. The Duluth, Minn.-based company announced a new round of job cuts on Thursday.
It plans to cut 50 support and administrative positions, mostly in Duluth, the Duluth News Tribune said. The company is also extending furloughs of about 100 production workers in Duluth and Grand Forks, N.D. They were part of 500 employees who have been off work since late November.
It’s the second round of workforce reductions at Cirrus. In September and October, the company cut 205 jobs. About 500 production workers were temporarily furloughed at the end of November as Cirrus shut down production. Most of them are now back to work, the report said. Workers who are on furlough continue to receive health insurance benefits, unemployment and supplemental pay from the company, it said.
Not counting workers on furlough, Cirrus employs about 900.
A loyal reader sent me a link to an article featuring Machinists union Local Lodge 839 president Kathy Petersen. Petersen represents hourly workers at Spirit AeroSystems. She previously served as the lodge’s vice president. and is an inspector at Spirit. She is featured as a “Sister of the Month” at the national IAM’s website. It’s a “great accomplishment,” the reader said.
