EBACE 2009: What’s missing is more notable than what’s here

Here in Geneva, the world is looking at EBACE as one of the first opportunities of 2009 to see how the industry’s canary is fairing in the proverbial coal mine. Though the largest gathering this year to date is notable not only for what is here at the show, but perhaps more importantly, what’s missing.

Recent months have brought us the suspension of programs like the large-cabin Cessna Columbus, suspected cancellation of the mid-size Hawker Beechcraft 450XP and the uncertain status of aircraft companies Grob and Adam, as well as painful cuts in production and staff across the industry.

Perhaps most notably absent, Eclipse Aviation, rightly or wrongly, pushed the industry for more than a decade to create an entirely new class of airplane found in the very-light jet.

Across the industry, development programs – many whose existence was never publicly discussed – have been quietly shelved, with manufacturers opting to batten down the hatches and ride out the storm, rather than invest capital into an uncertain and unsteady marketplace.

Though, for the business jet industry at-large, aircraft manufacturers face an unsustainable competitive landscape. For a moment, imagine a competitive environment where your chief opponent is not your fellow manufacturer’s competing product, but your own.  

With backlogs shrinking and aircraft utilization numbers thought to be approaching bottom, operators interested in buying an aircraft are finding purchase rates for existing aircraft far more competitive than buying one fresh off a production line. Manufacturers faced with this reality are undercutting their own price structure to bolster backlogs, all the while driving down prices further as supply outstrips demand.

The coal mine – at this point in 2009 – is particularly inhospitable. This week will be very telling.