First-Quarter Bloodbaths Expected
Analysts are lining up to paint a truly ugly picture of the first-quarter results that major business aviation firms will post this week. In its analysis, Bloomberg is predicting 2010 deliveries will sink to lows not seen since the post-9/11 slump. It says the analysts it has reviewed are predicting that Cessna's earnings may fall 90 percent and companies like Dassault, Bombardier and Gulfstream maker General Dynamics will report earnings levels not seen since 2003. But while the general economy is certainly the main driver of the downturn the lingering curse of the Big Three automakers' bailout flights continues to have an impact.
The U.S. government got the ball rolling with its disdain for business jet use, particularly by banks and other companies getting bailout money. Then corporations began idling their fleets out of fear of public perception and, most recently, according to Bloomberg, shareholders are staging revolts. The CEO of Dublin-based Elan Corp. is cooling his heels in security lineups these days for his regular trips to a research company in San Francisco after investors complained about the $6 million tab for the Gulfstream V that used to take him there. Bloomberg's scan of the analysts says it may be two years before bizjet sales recover.