The economy, the airlines and Wichita’s business jet industry went into a dive this year. And as Teal Group’s Richard Aboulafia points out, “While we’re nowhere near a recovery, at least we’ve stabilized.” As a result, “This New Year’s Day looks much happier than the last one.”
Still, it’s time to remain cautious. For one, the airline manufacturers have yet to feel any pain. And, Aboulafia said, “There are good reasons to think that the real pain may be coming.”
Business jet and regional jet markets took a dive in 2009. Wichita has lost thousands of jobs. At the same time, the large jetliner market grew 10 percent in 2009.
“Can you name any other manufacturing or service industry that grew in 2009, aside from foreclosure services and food stamp printing companies?” Aboulafia asks. “That means that our industry is approaching Ringo Starr levels of sheer good fortune, or, more likely, that most of the aircraft industry remains a lagging economic indicator.”
If it’s the latter, the pain will catch up with us sometime in 2010, he writes. Air traffic and fleet utilization is down, and there are 2,500 jets parked in the desert.
Not all analysts think Boeing and Airbus will cut single-aisle production rates in the new year. But Aboulafia poses the scenario as a likely one.