Viva Las Vegas

opinion

by Alasdair Whyte

October 28, 2024

“Bright light city gonna set my soul, gonna set my soul on fire.”

Elvis was singing about Las Vegas in the 1970s. We can only imagine what the lyrics would have been if he had seen the 366ft (112m) high Las Vegas Sphere covered by an advertisement from Gogo Business Aviation with his own eyes.

NBAA-BACE 2024 has been a good one. Cocktails have been drunk. Deals have been closed. Millions of business cards have changed hands. But the biggest take-away is the market is still going through a period of stability.

Textron Aviation announced upgrades to the Cessna Citation M2 Gen3, CJ3 Gen3 and CJ4 Gen3. All three new aircraft will feature Garmin Emergency Autoland technology, while the Citation CJ4 Gen3 will be fitted with next-generation Garmin avionics. The CJ4 Gen3 is expected to enter into service in 2026, with the M2 Gen3 and CJ3 Gen3 following in 2027.

Bombardier announced that it has started production of the Global 8000. But the biggest market news came from Textron and Gulfstream parent General Dynamics’ financial results.

Both OEMs delivered fewer aircraft in the quarter than they had hoped. Gulfstream was hit by supply issues (and some certifications for novel cabin interiors). Textron Aviation was hit by its strike. Both, however, had decent sales.

Gulfstream booked $2.4bn in orders in the third quarter and ended with a $19.8bn backlog. “After some slowing in the US during the second and third quarters, we are seeing improved interest across all models in the fourth quarter. Europe and Middle East activity is quite strong, but current activity in Southeast Asia and China has slowed. Interestingly, the overall number of prospects in all areas continues to increase,” said Phebe Novakovic, chair and CEO of General Dynamics.

“The overall number of prospects in our pipeline is at an all-time high, with the most active models being the G500, G600 and G700. We have a good cross-section of US businesses in this mix.”

Textron Aviation also had a good summer selling more than $1bn in new aircraft. “We’re very encouraged by the refreshes that the team is putting out in both M2, CJ3, the new CJ4 and the Citation Ascend is coming along very well,” said Scott C. Donnelly, CEO of Textron. “The end market continues to feel good. Order activity flow is good. We’re still feeling good about where the industry is.”

One of the aircraft in the exhibition hall that attracted lots of attention was Lilium’s electric jet. Sadly, the company said it was planning to file for voluntary administration just as the show was closing. Lilium failed to win a grant from the German government last week and is desperately looking for new investors.

“We deeply regret the insolvency and its consequences for all stakeholders at such a critical stage of our company’s development,” Lilium CEO Klaus Roewe said. “However, while there is no guarantee for success in insolvency proceedings, we hope that the Lilium Jet will get a chance for a fresh start after the self-administration process is completed.”

Like Vegas gamblers, companies can bounce back. Wheels Up announced a new $332m senior-secured five-year revolving loan with Bank of America that is guaranteed by Delta Air Lines, its biggest shareholder. It will use this to simplify its jet aircraft fleet. It plans to only operate Embraer Phenom 300 and Bombardier Challenger 300 jets, alongside its King Air fleet.

Some of this cash will let it buy GrandView Aviation’s entire fleet of 17 Phenom 300 and Phenom 300E aircraft.

As Elvis sang, the business jet industry is hoping to “keep on the run, I’m gonna have me some fun.”