Textron Restructuring

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Textron Inc. says it’s restructuring its Textron Aviation division in response to a “stubbornly soft” business jet market. Some layoffs have already occurred and the company is also offering early retirement incentives. In a conference call on the release of third quarter earnings, Textron CEO Scott Donnelly told financial reporters that while deliveries of business jets in the third quarter of 2016 were actually up over 2015, profit was down and that’s a reflection of the market. Still, the aviation division made $100 million in the third quarter and the company, as a whole, made $421 million in Q3. As might be expected, new jets are selling briskly while old designs are slipping.

The new Latitude, which began deliveries a year ago, is racking up sales while the rebaked XLS+ and Sovereign+ are not keeping up. Textron has high hopes for its larger Longitude super-midsize, which flew for the first time two weeks ago. “Most of our growth is driven by the new products coming onto the market,” he said. “That’s certainly true with the Latitude.” Textron has also recently announced the new Cessna Denali large turboprop single and the large-cabin Hemisphere jet. “At least in the market environment we exist in today, that’s the only way we drive growth.”

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