Month: October 2011

Cessna Business Jet Deliveries Increase

There is an increasing demand for Corporate Pilots as the BizJet Industry makes a comeback from the recession. This offers alternatives to aspiring commercial pilots in addition to flying for the airlines.

Cessna Aircraft, for example, delivered more jets and increased revenue and profit in the third quarter of this year as reported by its parent company on Wednesday.

Cessna delivered 47 new Citation business jets, compared with 26 in the same quarter a year ago. Its profit increased $64 million on higher revenue due to higher deliveries and good performance.

Cessna did better in order rates than expected in the third quarter, given the state of the world’s economies, said Scott Donnelly, Textron chairman and CEO, in a conference call with analysts.

“We’re not building backlog, and we haven’t been for the last couple of years,” Donnelly said. Most deliveries are the result of orders taken through the course of the year, he said.

“We are taking orders and turning them into sales inside the span of a quarter,” Donnelly said. He expects that to continue.

Orders have been coming in slower than aircraft deliveries, Donnelly said. Still, Cessna is on track to deliver slightly more jets this year than it did last, although some sales will have to be finalized to do it.

“I think the team is pretty well positioned to make that happen,” Donnelly said.

In note to clients, Cowen & Co. analyst Cai von Rumohr called Cessna’s profit for the quarter “impressive,” and $9 million better than expected.

XOJet Announces $50Million Order for Hawker 800XPRs

Jet charter operator XOJet announced a firm order for seven Hawker 800XPRs, with delivery of all of the aircraft scheduled before the end of 2011. XOJet also announced an order option for an additional five aircraft. The value of the deal “represents a potential commitment of up to $50 million,” according to Hawker Beechcraft vice president, Global Customer Support Christi Tannahill.

“XOJET’s 40 percent growth in 2011 clearly demonstrates that their innovative business model has been well-received by the private aviation market,” said Tannahill. “Our innovative Hawker 800XPR program can deliver the transcontinental capability, proven reliability and exceptional passenger comfort that will help XOJET continue on their growth path. Their commitment is a testament to the proven significance and value proposition of the 800XPR program.”

The acquisition adds a new midsize offering to XOJet, which is currently operating a fleet of 10 Citation Xs, nine Challenger 300s and a Challenger 605.

“The growth of our business demanded a third fleet type,” said XOJet CEO Blair LaCorte. Anxious to get the upgraded pre-owned Hawkers into service, XOJet will initially fly them with the older TFE731-5BR engines, replacing them with TFE731-50Rs–which is part of the XPR upgrade–as they become available. The aircraft will also get an avionics upgrade, major interior outfitting and custom exterior paint.

According to LaCorte, XoJet has experienced 130-percent growth over the past three years, despite the negative impact of the recession on the industry as a whole.

US Airline Industry Reports Passenger Traffic is Climbing

Southwest Airlines Co. said Friday that its number of paying passengers flew 7.9 billion miles last month, up 6.4 percent from a year earlier.

Southwest also reported that its seating capacity, or the number of available seats, rose 3.2 percent compared to the same time period a year ago. The occupancy rate of those available seats rose to 77.8 percent from 75.5 percent in September 2010.

The reported profit that the airline made from each of those passengers increased at twice the pace of traffic, because of higher fares. Passenger revenue per available seat mile, a measure of what the airline makes to fly a paying passenger a single mile, rose 12 percent from a year ago.

Traffic was also up for American Airlines in September. The Fort Worth-based airline said this week that it boarded 6.8 million passengers last month, up from 6.7 million in September 2010.

American reported a September load factor of 81.4 percent, which was 1.3-point increase from last year.
American’s regional sister airline, American Eagle, said it boarded 1.65 million passengers in September, up from 1.57 million last September.

American Eagle’s September load factor was 72.6 percent, an increase of 0.9 points compared to the same period last year.

American Eagle’s capacity increased 7.8 percent for the month, year over year.
Alaska Airlines passenger traffic rose 10.4 percent in September on a similar uptick in the carrier’s number of available seats.

Paying passengers flew 1.81 billion miles last month, up from 1.64 billion a year earlier. Alaska Airlines’ capacity rose 7.2 percent to 2.15 available seat miles. Airlines can increase capacity by flying bigger planes or adding more aircraft to their fleets.

Flights were also fuller last month. Alaska Airlines occupancy rate rose 2.4 percentage points to 83.9 percent.
Traffic on Hawaiian Airlines rose 5 percent in September but there were more empty seats as capacity increased more than traffic growth.

Passengers flew about 837.2 million miles, up 19.4 percent from 701.1 million miles in the prior-year period.
For the year to date, Hawaiian’s traffic climbed 2.9 percent, capacity increased 19.3 percent and average occupancy declined to 84.4 percent from 85.4 percent.

Frontier Airlines experienced a 5 percent increase in passengers in September compared with the same month a year ago, the airline reported Wednesday.

Frontier reported 1,257,797 passengers last month, up from 1,203,083 in September 2010. That follows a 3.8 percent year-over-year increase in August.

The airline’s revenue passenger miles — the number of paying passengers multiplied by miles flown — rose 2.0 percent in September from a year earlier, to 1.04 billion.
Frontier’s load factor — the percentage of its capacity actually used by passengers — rose by 3 percentage points from a year earlier, to 86 percent.

Frontier Airlines operates major hubs at Milwaukee’s General Mitchell International Airport and Denver International Airport. The airline, which absorbed Midwest Airlines of Oak Creek, is a subsidiary of Indianapolis-based Republic Airways Holding

Boeing Forecasts $760 Billion New Airplanes for North America

Airlines in North America will take delivery of 7,530 new airplanes over the next 20 years at a market value of $760 billion, according to a recent market forecast published by Boeing. Taking retirements of airplanes into account, the North American fleet will grow from 6,610 airplanes today to about 9,330 airplanes by 2030.

Demand in the United States and Canada will be mainly for single-aisle jetliners. For the purposes of the Boeing forecast, the North America market consists of the U.S. and Canada.

“The North American commercial aviation market improved for a second consecutive year with passenger traffic growth at a modest 3 percent,” said Randy Tinseth, vice president of Marketing, Boeing Commercial Airplanes, who released Boeing’s 2011 North America market outlook today in Montreal. “The region’s airline industry is poised for long-term, moderate growth. Airlines are expected to continue focusing on capacity discipline and improving financial performance.”

Boeing forecasts single-aisle airplanes will grow to 73 percent of the total North America fleet by 2030. A majority of this increased growth in the single-aisle category is related to traffic traveling to and from economically dynamic regions in Central and South America. New single-aisle airplanes offer significant advantages in improved capabilities, fuel efficiency and maintenance costs, as well as enhanced environmental performance, Boeing says.

Long-haul international traffic will continue to grow at an average annual rate of approximately 4.5 percent. This growth is expected to result in demand for an additional 1,180 new fuel-efficient, twin-aisle airplanes such as the Boeing 787 Dreamliner.