Aircraft Industry First Quarter Check-Up
The "current uncertainty in the U.S. economy is having an effect," specifically on the spectrum of piston aircraft, according to General Aviation Manufacturers Association (GAMA) President and CEO Pete Bunce. This year, Q1 piston-powered airplane shipments dropped 28 percent to 399 from 544 for the same period last year, according to GAMA's report. However, turboprop shipments were slightly higher and business jet shipments rose dramatically -- by more than 40 percent. In sum, total industry billings reached all all-time first-quarter high, up more than 16 percent over last year's. The divergent trends may be partially explained by worldwide economics. Accounting for 67 percent of piston deliveries last year, the North American market is an important player in worldwide figures and a downturn in that economy has broad effects. However, growth is strong in markets outside of North America and a good footing in multiple markets may ultimately provide some stability for those manufacturers best able to adapt to worldwide demand. The turbine segments showed impressive gains as did market share outside of the U.S. and North America. Economic stimulus in the form of bonus depreciation may be having a positive impact on aircraft sales, this year.
Alan Klapmeier, chairman and CEO of Cirrus Design Corporation, said he's heard from customers that the depreciation package put in place in February "is generating new sales within the piston segment." And, because the package applies to purchases made in 2008 and delivered in 2008 or 2009, the stimulus may favor the shorter turn-around time of piston aircraft manufacturers.