Noting that it has been 18 months since the “launch” of the Bombardier CSeries, Teal Group’s Richard Aboulafia said the troubled program could usher in a series of program problems from other manufacturers around the world prompting a dangerous trend in the industry.

“This is disconcerting, not just for the program, but for much broader reasons, too,” he told readers of his February newsletter, pointing out that Bombardier has received no firm orders and Lufthansa’s Letter of Interest, announced with the formal launch of the program at Farnborough last year, remains dormant. For that reason, the aircraft has been summarily dismissed from his company’s forecast.

“A second CSeries funeral would be chilling for an industry that’s already skittish, but it could be part of a big wave of chilliness,” he continued. “A struggling Hawker Beechcraft has shelved its Hawker 450. It may shelve its Premier II as well. Cessna, while healthy, may find it needs to slow down its Columbus program due to parent company Textron’s severe cash problem. Textron’s near-disastrous financial situation will also likely affect new civil helicopter development at Bell.

“The Mitsubishi RJ has morphed from an ambitious 787-related technojet to yet another 70-seat metal tube,” he said, continuing his litany of problem programs. “As for the big guys, Airbus and Boeing are postponing their new narrow-body studies, with talk of 2020 service entries. Most of all, the A350XWB development budget is the biggest cause for concern as
Airbus enters an industry downturn.”

However, Aboulafia sees cuts – engineering and business development personnel and new-product capital expenditures – as short sighted. In the past, he said, companies that cut too deeply had difficulty recovering from previous downturns.

Even so, he asks a tougher question – what happens if the OEMs have lost faith. “Perhaps they’re thinking that we’re entering a prolonged era of anemic growth,” he said. “The worst case scenario is ugly: a decade (or longer) of economic stagnation, with relatively inexpensive fuel compounding slack demand as a reason to not invest in future technologies and products. If that’s the case customers will simply make do with smaller numbers of current production model planes.”

However, Aboulafia cautioned, “betting against six decades of strong global economic growth is risky and foolish, despite economic forecasts that could see 2009 as the first year since World War II that the world sees zero or negative growth.”

As for a silver lining, the Teal Group analyst pointed to the defense budget as holding up. Even so, there could be clouds on that front given the fact that military spending did not benefit from the 2001-2010 budget uptick, suggesting that military programs, too, could fall to budget cuts.

“Zero growth and a defense budget crunch, in short, mean possible carnage for new aircraft and new aircraft technology,” he concluded, noting that his company has updated the prospects for the Challenger 300, S-3, F-16 and B-1. “Our industry thrives on innovation, particularly with products that offer better economics to move people. If the CSeries dies again, the second funeral wouldn’t be at all like the first. It would be an occasion for genuine concern and perhaps even mourning.”

Global Aircraft Fleets Decrease in Tough Economy

Sound Bite
Despite all the condemnation of business and general aviation spewing from the halls of Congress and new media, the public does understand the value of the segment, according to a survey done last November by the Aircraft Owners and Pilots Association. However, it begs the question as to whether the organization would get the same results now.

Still the statistics are heartening. Fuller, who first reported public understanding of general aviation at last month’s reauthorization hearing, left much unsaid in his brief comments on the subject. AOPA told Aviation Today’s Daily Brief that 62 percent of voters recognize that general aviation is an important part of the national transportation system. Part of a larger a larger election-night poll of voters' attitudes, the questions were only asked of people who had already voted. Indeed, while a minority, it is still impressive that 30% of voters described general aviation in America as "important to me and my family."

Four out of ten voters said they'd flown in a general aviation aircraft, according to the organization which concluded by adding a clear majority of those voters expressing an opinion on the issue said they oppose "shifting more of the burden of funding our national air traffic control systems from the commercial airlines to general aviation users."

First Phenom Mx Contract
Elizabeth and Jim Frost became the first U.S. customers to sign up for the Phenom 100 Embraer Executive Car (EEC) program, providing for a fixed, cost-per-hour maintenance program. The couple were the U.S. launch customers for the Brazilian very light jet. The EEC was created in 2001 to support the Legacy 600 and was extended to the Phenom at last year’s National Business Aviation Association convention. It includes web-based maintenance tracking software.

SuperJet’s Russian Office
Fresh from the debut of its Washington Office, SuperJet International launched a Moscow branch for sales and support for the Superjet100. The Russian branch will be SuperJet International’s (SJI) frontline to complete the development of support solutions in all required areas, including technical support, material support and logistic solutions, training solutions for all categories of customer personnel, as well as all the necessary commercial services for customers in different regions of the world committed to Sukhoi Superjet 100 entry into service.

The Moscow branch will be managed by Vice President of Customer Services Dmitry Mirgorodsky, who joined SuperJet International from SuperJet100 manufacturer Sukhoi Civil Aircraft Company and brings with him his significant experience in airline industry operations.
“The opening of the Russian Branch is of particular interest,” said SuperJet International CEO Alessandro Franzoni, adding it will be a permanent office serving Russian customers. “This collaborative effort between SCAC and SJI is essential to the success of the Sukhoi Superjet 100 Program.”