Professional Pilot, October 2016

Business turboprops VLJs and light jets PROFESSIONAL PILOT October 2016 17 05 The top tiers of the market may be in the midst of a serious downturn but at least there are only 3 manufacturers in that segment In fact this downturn may even have a beneficial side effect for Bombardier Dassault and Gulfstream it serves as a warning that the top half of the market is not always a guaranteed visa free growth journey That may well dissuade newcomers such as Embraer from developing new models in the higher brackets And depending on the severity of the downturn along with many other factors Cessna may even need to reconsider its proposed Hemisphere large cabin jet If nothing else the high end downturn delays the day when any manufacturer particularly Aerion can bring a supersonic business jet SSBJ to market Considering that all 3 legacy manufacturers have recently introduced allnew models that emphasize cabin size and range instead of speed an SSBJ represents a possible threat and one thats best delayed for as long as possible Everyone wants to move up or down The bottom rung of the market by contrast with the high end is something of a free for all with many players moving up from adjacent segments and too many legacy as well as new model aircraft being offered for sale The result is a serious problem with industry overcapacity Looking at the situation from a positive perspective the market for business aircraft available in the 2 million to 7 million price point range has a remarkable number of new products and technologies But it is difficult to see how they can all survive Personal jets VLJs and TPs Starting at the bottom Cirrus is poised to bring its Vision SF50 to market with a 196 million target price It claims to have 600 orders and plans to build from 120 to 125 of the new personal jets per year The idea of a low cost personal jet is certainly exciting and has the potential to stimulate the market with a new product But there have been many spectacular failures on the single engine personal jet path most notably the Piper Altaire and Diamond D Jet Personal jets are also haunted by the failed legacy of the very light jet VLJ which were supposed to stimulate the market with increased interest from owner operators along with unprecedented demand from revolutionary air taxi schemes But it all proved a huge disappointment Production of Cessna Mustangs and Embraer Phenom 100s has slowed to a very thin trickle The Eclipse program was an even more spectacular failure going bankrupt after 260 aircraft were built ONE Aviation is now working to keep the Eclipse line going at a low rate while simultaneously working to develop the new Kestrel 350 turboprop If successful there will be another low cost turboprop on the market with a 32 million price tag One reason VLJs failed so spectacularly was that turboprops continued to enjoy strong market demand As our chart indicates VLJs are now just a tiny percentage of single and twin turboprop output But this has led predictably enough to a rush of new turboprop products Piper for example is now offering its M500 M600 family of TPs This leverages its earlier Meridian turboprop product with the 28 million M600 offering a new wing Like Cirrus Pilatus is a successful propeller aircraft player seeking entry into the jet market The companys PC24 light jet first flew in May 2015 and is scheduled to enter service in mid 2017 Pilatus is far more modest than Cirrus having merely claimed to sell 84 aircraft which will cover its anticipated production between 2017 and 2019 Value of deliveries in 2016 billions Single TPs Twin TPs VLJs 3 25 2 15 1 0 90 94 98 02 06 10 92 96 00 04 08 12 14 16f