The general aviation industry’s economy is either growing or softening depending on whether you fill up with Jet A or 100LL. Thanks to foreign sales and tax incentives, manufacturers are so far weathering the economic storm.
The piston-powered airplane segment has seen a 28-percent decrease in shipments—399 units from 554—when comparing the first quarter of 2008 with the same period last year. Things are boding much better for business jets with a 40.8-percent increase. While total industry billings were up by 16.1 percent or $ 5.3 billion, an all-time high for the first quarter, total shipments were down by 7.5 percent.
“Last year, 67 percent of piston deliveries were to the North American market, making this segment the most susceptible to softness in the U.S. economy,” said Pete Bunce, president and CEO of the General Aviation Manufacturers Association. “However, as worldwide markets continue to expand, we see more capability to insulate manufacturers from the economic dynamics of any one specific region.”
Helping the piston market was a tax incentive called bonus depreciation as part of the Bush administration’s economic stimulus package. While it applies to both piston and turbine airplanes, Cirrus Design President Alan Klapmeier said it more proportionately benefited piston manufacturers because of the current backlog of jet orders. The tax break applied to purchases made in 2008 with deliveries later in 2008 or 2009.
Cessna Aircraft shipped the most single-engine piston airplanes with 113. That includes the newly acquired 350 and 400 models of which it tallied 16. Cirrus, meanwhile, shipped 76 airplanes.