Cessna is readying a slate of clean sheet and product upgrades in its super-light and medium-sized business jet line to take on the equivalent from Embraer's Legacy 450 and 500 development programmes.
The new aircraft would replace the $12.5 million Citation XLS+ super light twin and $17.6 million midsize Sovereign.
"As the market comes back you do see new entrants like Embraer dropping some new aircraft in the [sector] where our aircraft have historically lived," says Scott Donnelly, chairman and chief executive of Cessna parent company, Textron. "And that's part of what's driving a lot of the investments we're making".
Donnelly made the comments during a fourth-quarter financial earnings call with analysts on 26 January.
Cessna delivered 179 Citation jets in 2010, down from 289 in 2009, and expects to ship as many as 200 aircraft in 2011. Though deliveries will be similar to last year, Donnelly expects improved revenue due to a "stronger bias" toward more light and midsize aircraft as opposed to very light Mustangs, which accounted for 43% of the deliveries in 2009.
Countering the continued depressed sales is an increasing research and development budget.
Donnelly says the ratio of R&D to sales at Cessna "are at a very high number and growing", a trend he says is "a necessary action" for the company.
"The development cycle of an aircraft does not fit well with financial cycles", he says. "I think this is something we need to go do, and obviously it's something we're pulling the trigger on".
In October, Cessna launched an upgraded version of the Citation X with enhanced Rolls-Royce engines, elliptical winglets and a new Garmin G5000 integrated avionics suite, but hinted at much more to come. In addition to a single-engine turboprop to fill the gap between the Corvallis TT piston and the Mustang very light jet, Cessna said it had other clean sheet designs that it would unveil in coming 18-24 months.
Donnelly says that although the Mustang very light jet and recently certified CJ4 light jet have been successful, Cessna "needs to make the right investments in upgrades as well as clean sheet aircraft in [Legacy 450 and 500] core space".
"We need to make the investments in that light to mid-size market and put off to another day any expansion of that portfolio up into the larger aircraft like the Columbus," Donnelly added. Cessna put its flagship large-cabin Columbus programme on hold indefinitely in 2009 after the market downturn.
Despite the economy, Embraer has proceeded full bore with the development of the $15.2 million Legacy 450 midsize and $18.4 million Legacy 500 super midsize jets, slated for first deliveries in second half of 2013 and 2012, respectively.
Donnelly notes that R&D spending on the new models would probably peak in 2013, but he was coy on when Cessna would reveal the "couple of clean sheet" models.
"How and when we choose the make the commercial announcement will be based on our view of the reception of the programme," he says. "At this point, it will be more based on what the market environment and orders it can drive, rather than the maturity of the programme."
Read more about Cessna's XLS+ and Sovereign business jets at flightglobal.com/xls and /sovereign
Source: Flight International