Page 6 - Elite AirMail Q1 2023

INDUSTRY NEWS
Q1 BETTER THAN EXPECTED FOR JET MANUFACTURERS
Multiple private and commercial jet manufacturers re- cently reported strong first quarter sales, a positive develop- ment for a market shrouded by uncertainty for months.
“There is evidence that demand and supply forces are re- balancing with less frenetic activity, more realistic pricing and a slow but steady buildup of available inventory,” said Zipporah Marmor, chair of the International Aircraft Deal- ers Association. “Although specific, low-time aircraft with attractive pedigrees continue to attract top dollar, the overall market has begun to downshift from a peak characterized by accelerating prices and strong residual values.”
Brazilian manufacturer Embraer, which produces the Legacy line, said in its Q1 earnings call that it delivered 15 jets between January and March. Eight deliveries were to corporate jet operators—six light airframes and two heav- ies—while the remaining seven went to airlines. It was a 7% uptick compared to Q1 2022. Embraer credited the success largely to sales of its Phenom 300, a single-pilot certified air- craft that can hold up to 11 passengers. The Phenom 300 is also a strong contributor to the company’s $17.4 billion order backlog as of March 31, according to a report to investors.
Textron Aviation, which makes the Beechcraft and Cess- na jet models, told its investors in April that its first quarter profits increased despite a dip in aircraft deliveries—to 35 from 39 the same time last year—attributing the outcome to rising prices. The profit numbers beat Textron’s projections,
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with the business jet sales offsetting a lag in the firm’s Bell helicopter revenues. Total Textron Aviation revenues were $1.1 billion, up $109 million from last year. Pricing increas- es acounted for $58 million, volume only $51 million. And while industry analysts have suggested pricing may moderate in the coming months, Textron said it would have delivered more aircraft if not for continued supply chain issues.
Adjusted for inflation and other factors, Textron’s Cessna division has impressed investors, earning $1.05 per share in Q1 2023 compared to an industry average estimate of $1 per share. Funds tracking the airline and jet manufacturing indus- try fell in early March before beginning a gradual recovery.
Bombardier, which makes the popular Global and Chal- lenger corporate jet lines, reported that its revenues rose to $1.5 billion in 2023’s first quarter. The number represents a 17% increase from the same time last year, when the com- pany announced revenues of $1.2 billion. In its call with investors, Bombardier said the results were driven by high aircraft margins and aftermarket growth. According to Re- uters, Bombardier delivered 22 business jets between Janu- ary and March 2023, up from 21 in 2022.
Late last year, many jet manufacturers began expressing trepidation about their sales prospects. “It’s slowing down a little bit,” Dassault Aviation CEO Eric Trappier said in No- vember 2022. “Is it the start of a crisis or not? It’s hard to say because the demand is strong.”
Embraer sold eight corporate jets and seven airliners in 2023’s first quarter.