Wichita’s business aircraft manufacturers are busy with a number of new products in the pipeline, and that’s good reason for optimism for the future, experts say.
In fact, the amount of research and development and new programs in Wichita today is “pretty much unprecedented,” said aviation consultant Rolland Vincent, with Rolland Vincent Associates in Plano, Texas.
“You’re seeing R&D investment, you’re seeing a lot of engineering focus, and you’re seeing new products,” Vincent said. “If an industry is unhealthy, it’s not investing. This industry is investing.”
Cessna Aircraft recently had back-to-back certifications of three new products on the business jet side, with two more in development.
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Bombardier Learjet’s Learjet 85, the largest and longest-range Learjet to date, is also in the works.
That kind of development wasn’t the case during the last big downturn during the 1980s, Vincent said.
Then, “there was not a lot of investment,” he said. “This is a big difference. (Manufacturers) are investing for the future. They’re putting their money down.”
An upturn in the business jet market will be spurred by those new products, which stimulate sales, experts say.
The light and midsize part of the business jet market, where Wichita planemakers do business, was hit hard during the recession.
Recovery has been slow to stalled ever since.
Industry experts predicted that 2013 would mark the bottom of the market and that 2014 should bring a modest upturn – in large part because of the new products.
There is pent-up demand in the United States, the biggest market for business jets worldwide, Vincent said.
The U.S. market is a replacement market with about 80 percent of buyers replacing current aircraft, he said.
But in the past couple of years, they’ve delayed those purchases.
“The good news is, a lot of new products are on the market and they have something new to look at – new, more capable airplanes – and they’re going to be buying them,” Vincent said.
Manufacturers must be in a constant development process to stay competitive, he said.
“Constant development is critical,” Vincent said.
The highest number of deliveries for a new model usually come three or four years after it comes out. Orders then begin to taper off. The life cycle of a new model is seven to 10 years, Vincent said.
It takes five or six years for a new plane to be developed and enter service. That means planemakers must start investing in the next model three years after a new one comes out, he said.
“It’s not a question of investing and harvesting,” he said. “It’s a constant R&D, a constant development process.”
Cessna Aircraft is seeing a flat market for its legacy products – products that have been in production for at least a year, Scott Donnelly, chairman and CEO of Textron, Cessna Aircraft’s parent company, said earlier this year.
Still, Cessna is predicting an increase in deliveries this year after a low year of shipments in 2013.
“I think the safe assumption at this stage is to assume that the market dynamic overall is relatively flat to what it was in 2013 – and then all the upside or improvements come from the introduction of new products,” Donnelly said.
Cessna delivered its new Citation M2 and updated Sovereign at the end of 2013 and will have a full year of deliveries in 2014. That will give total deliveries a boost this year.
Its upgraded Citation X is on track to be certified soon, Donnelly said earlier this year.
Cessna also is working on the nine-seat Citation Latitude, slated to be certified early in 2015. It’s also developing a long-range super-midsize jet, the Citation Longitude, scheduled for certification in 2017.
“These new products are things that really drive growth, and we would certainly expect to see growth in 2015 driven by the introduction of the Latitude,” he said.
In west Wichita, Bombardier replaced its Learjet 40 and 45 with the Learjet 70 and 75, light business jets based on the same airframe. The upgraded models include modifications to improve performance with new avionics, winglets and engines that use less fuel.
The two models were delivered to customers late last year.
Bombardier also continues work on the new Learjet 85, a midsize jet with new technologies and advanced composite materials. It’s Learjet’s longest-range and fastest Learjet to date.
Range is king
In every size aircraft, planemakers are offering more range than ever before.
“The new designs are reflecting demand requirements from customers,” Vincent said. “They want range, they want speed. ... They want more than they had.”
Engines are being upgraded to squeeze out more range, and designers are using new materials that lower weight.
Long-range aircraft have been in demand with customers internationally. And customers have been asking for larger cabins.
That business has gone to planemakers outside Wichita that offer big jets with long ranges, such as Gulfstream and Bombardier.
Finally, Vincent said, Cessna is coming out with the Longitude. “It’s a little bit overdue,” he said.
Beechcraft quit building business jets during its Chapter 11 bankrutpcy. But it has continued with research and development projects.
Textron, Cessna Aircraft’s parent company, announced a deal in late December to buy Beechcraft for $1.4 billion. It’s expected to close midyear.
In the meantime, it’s business as usual, Beechcraft CEO Bill Boisture said recently.
That includes efforts to upgrade the product line, Boisture said.
During the National Business Aviation Association’s convention in 2012, Beechcraft announced plans for new turboprop airplanes, including a twin-engine turboprop to fill the niche between the King Air 250 and King Air 90. It also said it was considering a single-engine variant of the King Air.
Whether the company will formally launch the programs is yet to be determined.
Among the bigger planes coming online are Bombardier’s Global 7000 and 8000 program, and the company is updating its Challenger 300 to the Challenger 350 configuration.
And Brazil-based Embraer is gaining market share, in part because of the Legacy 450, a midsize business jet, and its big brother, the Legacy 500, which are under development.
The Legacy 500 is expected to enter service this year, followed by the Legacy 450 next year.
Still, Wichita rules, Vincent said.
“At the end of the day, there are 20,000 unique operators (of turboprops or business jets) out there today worldwide,” he said.
Cessna has more than 6,600 Citations flying. Beechcraft has more than 6,000 King Airs in operation.
“Between the two of them, probably more than half are customers of Wichita and buying and flying Wichita airplanes,” Vincent said.
Keeping customers happy and providing good service are key, he said.
Planemakers in Brazil and Japan want some of Wichita’s customers.
Because Wichita planemakers are keeping customers well served, it’s easier for them to go out and try to create their own following by identifying new customers, Vincent said.
That’s one reason Textron’s purchase of Beechcraft is a good thing, he said.
Cessna and Beechcraft both have loyal customers and great brands, Vincent said.
“I think it’s brilliant,” he said. “I think it’s strategic and probably the best thing that could happen to Beech.”