Gulfstream recorded a robust performance last year on the back of continued strong demand for its G650/ER, output of which will rise again in 2016.
The ultra-long-range aircraft is bucking the trend at the top end of the business jet sector, where falling international demand has triggered a decline in new orders for most models in the category.
Speaking on a full-year earnings call on 27 January, Phebe Novakovic, chief executive of Gulfstream parent General Dynamics, indicated that G650/ER production had been increased in the second half of 2015 and will rise again in 2016 "to reflect current demand and our sizable [two-year] backlog”.
That rate “is clearly sustainable for this year and next”, she says.
Gulfstream’s other large-cabin models – the G550 and G450 – fared less well in 2015, prompting the airframer to cut output of both.
“We've been reducing the G450 very incrementally for the last seven or eight quarters in line with a fall in demand and what we predicted in demand,” Novakovic says. “We reduced the G550 production rate, again, in line with demand."
She says the move is also part of the company’s transition to its new large-cabin duo, the G500 and G600. The clean-sheet Mach 0.90 aircraft were launched in 2014 and are scheduled to enter service in 2018 and 2019, respectively. Gulfstream stresses the aircraft will complement and not replace the G450 and G550.
Overall, Gulfstream delivered 112 large-cabin jets and 35 midsize jets – the G280 and G150 – last year. This compares with 115 large-cabin and 29 midsize aircraft in 2014.
This year Gulfstream forecasts shipments of 104 G650/ER/G550/G450s, and 34 G280/G150s. “So [we predict shipments will be] down eight large and one medium-cabin [on 2015] – with a better mix, I might add,” says Novakovic.
Gulftream’s order backlog in 2015 grew by $200 million to $13.3 billion, General Dynamics says. The company also recorded a book-to-bill ratio of 1:1.
The overall performance of General Dynamics Aerospace unit, which includes business aviation services provider Jet Aviation, was robust in 2015.
Revenues for the 12 month period climbed 2.3% to $8.85 billion and operating earnings rose by nearly 6% to $1.71 billion.