Bizjet manufacturers will ride a wave of record backlogs for a few years but the party might be winding down. David Strauss, an analyst for UBS, told the Toronto Globe and Mail that his research shows overall business flight activity is down 11 percent in the past year and that while that´s mainly an indication of overall business trends, it´s only a matter of time before it hits bizjet manufacturers. "Still strong order activity would appear to indicate a business jet market that is holding up well," Strauss told Globe business blogger David Berman. "However, as evidenced by our proprietary business jet survey and building used inventory levels, we believe the market has come off from its peak and is likely to fall further, although deliveries and earnings could continue to grow given unprecedented backlogs."
Strauss said use of Dassault and Bombardier aircraft have fallen the most, at 10 percent, Hawker Beechcraft usage is down 7 percent, Cessna off 5 percent and Gulfstream 2 percent. But while Bombardier is feeling the brunt of the current slowdown, its share prices are leading the pack. They´re up a whopping 24.7 percent this year over last, despite dropping 16.5 percent from their peak in June. By contrast, shares in Textron, which owns Cessna, have dropped 47 percent in the last year, but don´t blame the airplanes. Textron is a more diversified company than most in the aerospace business and has been hit harder by general market conditions.