While worldwide sales of general aviation aircraft have softened in 2016, Cirrus Aircraft is off to its strongest start since eight years ago, when the U.S. economy teetered into a recession.
The Duluth-based airplane maker shipped 153 aircraft during the first six months of this year. That’s more than a 30 percent bump in production compared with the same period last year.
And Cirrus’ billings were even more bullish, with sales for the first half of 2016 up more than 35 percent compared with the same period last year.
The company’s robust performance is even more remarkable, considering what’s been happening in the industry. Sales of planes designed for general
aviation - or noncommercial civil aviation - are off 11 percent for the first half of this year, compared with the first half of 2015, according to the General Aviation Manufacturers Association. Meanwhile, total shipments for the same period slid 4.5 percent.
“We did have a strong first half,” acknowledged Ben Kowalski, vice president of marketing for Cirrus.
But he warned onlookers not to read too much into the early numbers.
“What’s going on here is we’re working to adjust for some of the seasonality we’ve had in past, and we’re working to smooth out some of our deliveries … . So that resulted in us delivering more aircraft to the market in Q2 this year,” Kowalski said.
“We do aim to be up this year, versus last, but not by the percentage that we are for the first half,” he said, predicting slight overall growth. That, in itself, will be an accomplishment, given the state of the industry and the uncertainties in Brazil, Europe, currency issues and the trade implications of pending elections, Kowalski said.
Part of the credit for Cirrus’ strong first half of the year also should go to clearer tax codes that give customers confidence to purchase airplanes, knowing that they will be eligible for the financial benefits of asset depreciation, Kowalski said.
Of course, he also tipped his hat to the concerted efforts of Cirrus’ sales force.
For Cirrus, the start of this year has been its busiest since 2008, when the company churned out 239 airplanes from January through June.
That’s 86 more planes than it sold during the first six months of 2016, but the souped-up aircraft Cirrus delivers to its customers these days fetch much bigger prices. The airplanes Cirrus shipped this year sold for an average of more than $746,000. Meanwhile, the average price of a Cirrus airplane shipped in 2008 was just over $549,000, adjusted for inflation. As faster Cirrus airplanes with more features have moved to market, its customers apparently have been willing to open their wallets wider, paying an average of better than 35 percent more for each bird.
“I think the key is that Cirrus continues to deliver exceptional value to our customers. Each year, we bring new safety technology and comfort enhancements to the aircraft that our customers appreciate, and they recognize that value,” Kowalski said.