Textron Aviation Sees Mixed Aircraft Deliveries in Q3

 - October 17, 2019, 10:54 AM
Some Cessna Citation Longitude deliveries will be pushed back to first quarter of 2020 because of modifications required by FAA certification, Textron CEO Scott Donnelly told analysts this morning. (Photo: Textron Aviation)

Modifications to the recently certified Cessna Citation Longitude will push some deliveries out to early next year, while deliveries of legacy Citations are expected to be flat year-over-year as customer demand takes a pause because of economic and political uncertainty, Scott Donnelly, CEO of Textron Aviation parent company Textron, said this morning during a third-quarter earnings call. For the quarter, Textron Aviation delivered 45 jets, up from 41 in third-quarter 2018, while turboprop deliveries edged lower to 39 versus 43 in the same period last year. 

The Wichita airframer’s profit rose $5 million, to $104 million, in the quarter on revenue of $1.2 billion—$68 million higher from the third quarter last year.

Donnelly explained that FAA certification required some modifications to be made to the Longitude, which will push some deliveries originally expected in the fourth quarter to the first quarter of 2020. They are “technically minor modifications,” he said, “but they’re invasive” and are slowing deliveries to some customers.

Upon questioning by one analyst, Donnelly said the modifications include wiring and connectors. He did not indicate if they also included changes brought about over the super-midsize jet’s fuel tank flammability requirements, which contributed to the Longitude’s certification delay. The modifications are not expected to slow deliveries beyond the quarter, Donnelly added. 

Also, Textron Aviation will likely deliver about the same number of legacy business jets in 2019 that it did in 2018. Earlier this year it was expecting legacy deliveries to be higher for 2019. “When you talk to customers and they look at uncertainty—you’ve got trade deals, you’ve got Brexit,” Donnelly said. “Most of these guys can’t feel good watching the political stuff that’s going on in D.C. It creates a lot of uncertainty. And I think we see this reflected in the business confidence surveys.”