Despite eight order cancellations, manufacturer remains upbeat, but rival Cessna forecasts 'flat to lower' deliveries

Gulfstream had eight business jet orders cancelled in the first quarter, mainly by customers unable to finance their purchases, but it believes the worst of the economic downturn may be over. Despite the cancellations, Gulfstream "did okay on orders" in the quarter, says Nicholas Chabraja, chief executive of parent company General Dynamics.

Customers with orders for the G550 (formerly GV-SP) ultra-long-range business jet were required to make a cash payment on provisional certification of the aircraft, which was achieved late last year. "We expected this point would produce cancellations, and it did," says Chabraja. "We expect they [the cancellations] are behind us now."

US fractional-ownership operator NetJets did not cancel any Gulfstream orders in the first quarter, although is believed the company has slowed deliveries. "We are always rearranging delivery dates with NetJets," says Chabraja. NetJets did cancel $370 million in Cessna Citation orders in the first quarter, and has delayed some Dassault Falcon 2000 deliveries.

Gulfstream delivered 15 green aircraft in the first quarter, down from 27 a year earlier: seven G550s, one G400, one GIV-SP, two G300s, one G200 and three G100s. The company delivered 17 completed aircraft to customers in the quarter, down from 25 a year earlier: five GVs, nine GIV-SPs, two G200s and one G100. Gulfstream also sold four used aircraft at a $24 million loss.

Cessna delivered 50 Citations in the first quarter, with four fewer than planned going to NetJets because of cancellations. The company booked 22 net business jet orders in the first quarter, 18 for delivery this year, and its high-end forecast of 195 Citation deliveries this year - down from 305 last year - is now 83% sold, says Lewis Campbell, chief executive of parent company Textron. Cessna is forecasting "flat to lower" deliveries next year, he says.

Raytheon also reported falling deliveries and orders in the first quarter of 2003. The manufacturer, which produces Beech, Hawker and Premier business jets and turboprops and T-6A Texan primary trainers, delivered 50 aircraft, compared with 59 in the same period in 2002. But bookings fell far more steeply, from 137 in 2002 to 35 in 2003.

The sharpest falls were in orders for the Hawker, Premier I and Beechjet business jets. Hawker orders fell to seven from 40; Premier I orders fell from 32 to three; and Beechjet orders were down to two from 39. Net sales fell to $377 million from $494 million in the first quarter of 2002.

Source: Flight International