Third Annual Analyst & Investor Meeting - Corporate Market
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Transcript of Third Annual Analyst & Investor Meeting - Corporate Market
III Annual Analysts & Investors M e etingNov 22, 2 0 0 2III Annual Analysts & Investors M e etingNov 22, 2 0 0 2
Contents
• Our Forecast Method
• Scenario
• Market Overview
• Legacy in the market
• Legacy Product
Market Forecast Methodology
• Determine External Scenario
• Examine Internal Scenario
• Evaluate Business Jet Forecasts from Inside and Outside Sources (Top-Down Analysis)
• Perform Customer Focused Research /Survey(Bottom-Up Analysis)
• Analyze Results and Make Forecast for Inclusion in Action Plan
Scenario Overview
Ø Corporate Aviation Market has been strong and robust one
Ø Main drivers
- Fractional/ownership demand/expansion
- Globalization
- Security issues
- New models with more performance and comfort
- Airline service insatisfaction
Ø “Corporate Aircraft: tool to leverage business” a Corporate Jet Study
Scenario Overview
Ø After Sep 11: new security measures, increased interest in business aviation,
new program launches and competitors movements in business expansion
Ø Business aviation historical data demonstrates that this sector has important
participation in economy rebound
Market share by manufacturerWorldwide Corporate Jet Fleet
USA:
MEXICO:
BRASIL:
11774(70%)8,710 (76%)
444 (4%)
377 (3%)
1,240 (11%)
365 (3%)
63 (1%)
222 (2%)Brasil: 279
Mexico: 416
USA & Canada: 8.710
Total Market Forecast10 Years period (2003-2012) forecast
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
Embraer Teal Honeywell Rolls Royce(est)
Forecast Average
Average: 750 per yearAverage: 750 per year
M arket O v ervie wM arket O v ervie w
Market SegmentationMarket Segmentation
Lears and Citations
$10.0 - 13.0M
$5.0 - 7.0M
$13.0 - 20.0M
$20.0 - 30.0M ChallengerG IV-SP
Lear 55/60Hawker 800; Citation VII
Supermidsize
Midsize
S m all
Large
Falcon 50
$2.4 - 5.0M
$12 - 13.0M
$6.0 - 7.0M
$9 – 10 M
$16.0 - 22.0M
$24.0 - 32.0M
$ 46 - 64.0M • BBJ1 / BBJ 2• Airbus 319 CJ
• Challenger 604• Falcon 900• G 400
• Citation X • Falcon 50 • Falcon 2000 • G200 • Challenger 300 • Horizon
• Hawker 800 XP • G100• Lear 60 • Sovereign
• Lear 45 • Excel
$20.4M
• G 500 / G 550• Global Express• Falcon 7X• Global 5000
$ 33 - 45.0M
• Citation Jet • CJ1 • CJ2 • • SJ-30 • Premier • Mustang
• Beechjet 400A • Lear 31 • Bravo
Global
Ultra-Long Range
Large
Supermidsize
MidsizeMidlightLight
Entry
20021993
Lears and Citations
$10.0 - 13.0M
$5.0 - 7.0M
$13.0 - 20.0M
$20.0 - 30.0M ChallengerG IV-SP
Lear 55/60Hawker 800; Citation VII
M arket O v ervie wM arket O v ervie w
Source: Business and Commercial Aviation May 2001
Aircraft Cabin Volume Baggage Range Price (cu.ft./ m3) (nm) (US $M)
Challenger 300 860/ 24.3 120 / 3.40 3,067 16.3
Horizon 757/ 21.4 110 / 3.11 3,245 17.3
Citation X 508/ 14.3 72 / 2.04 3,077 18.9
Gulfstream 200 870/ 24.6 150 / 4.25 3,606 20.1Falcon 50EX 700/ 19.8 115 / 3.25 3,250 19.5
Legacy 1,410/ 39.9 240/ 6.79 3,100 20.4Falcon 2000 1,024/ 28.9 134 / 3.79 3,038 23.5
Challenger 604 1,035/ 29.3 115 / 3.25 3,973 23.8Falcon 900C 1,267/ 35.8 127 / 3.58 4,404 29.5
G400 1,525/ 43.1 169 / 4.78 3,976 32.7
Best ValueBest Value
Supermidsize Segment Forecast
100120140160180200
Supermidsize segment forecast Embraer
0
50
100
150
200
250
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Average2003 /2012
Average:163 per yearAverage:163 per year
Large Segment Forecast
Average: 96 per year
Large segment forecast Embraer
0
20
40
60
80
100
120
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Average2003 /2012
Source: AIN
Market share by manufacturerProjected Supermidsize/Large Market Share by Manufacturer
Source: Embraer Corporate Jets
Forecast for the period of 2003 to 2012(163 +96 = 259 a/c on average/year)
17%
23%
23%
10%
10%
17%
CessnaRaytheonEmbraer (over 240 A/C)General DynamicsBombardierDassault
Legacy OrderbookLegacy Orderbook
Legacy Worldwide Aircraft Orders
USA - Executive 34 35 69
USA - Shuttle 32 56 88
Europe - Executive 2 - 2
Latin America - Executive 5 - 5
Total 73 91 164
Current as of September 2 0 0 2
Corporate Aircraft Fa milyCorporate Aircraft Fa mily
• Engine – A1/3
• No Winglets
• Range – 1730 – 1830 nm
• 16-37 Passengers
• Engine – A1E
• Winglets
• Range - 3100 NM
• 10-18 Passengers
Executive Version
Shuttle Versions
Executive VersionExecutive Version
C o m p arisonsC o m p arisons
1 0 2 0 3 0 4 0 5 0ft
m 3 6 9 12 15
Challenger 300
2 5‘(7.62 m)
2 3‘ 8”(7.22 m)
Horizon
G 2 0 0 2 4‘ 6”(7.46 m)
Super MidsizeFloor Plan Comparison
Source: Conklin & de Decker’s “The Aircraft Comparator”
42’6”(12.94m)
C o m p arisonsC o m p arisons
Horizon
Challenger 300
G200
W idth Height A isle Recess
Challenger 300 7 '2 '' (2 .1 8 m ) 6 '1" (1.85m)
Horizon 6 '6" (1.98m) 6 '0"(1.83m)
G 2 0 0 7 '2" (2.18m) 6 '4" (1.93m) 6" (0.15m)
Legacy 6 '1 1 "(2 .1 m ) 6 '0" (1.83m) 2" (0.05m)
Supermidsize – Cross Section Comparison Source: Conklin & de Decker’s “The Aircraft Comparator”
1 0 2 0 3 0 4 0 5 0ft
m 3 6 9 12 15
C o m p arisonsC o m p arisons
Challenger 604 25’6”(7 . 7 7 m)
G 4 0 041’(12.5 m)
LargeFloor Plan Comparison
Source: Conklin & de Decker’s “The Aircraft Comparator”
42’6”(12.94m)
C o m p arisonsC o m p arisons
W idth Height A isle Recess
Challenger 604 8 '2" (2.48m) 6 '1 " ( 1 . 8 5 m )
G 4 0 0 7 '4" (2.22m) 6 '2 " ( 1 . 8 7 m )
Legacy 6 '1 1 " (2 .1 m ) 6 '0 " ( 1 . 8 3 m ) 2 " ( 0 . 0 5 m )
Challenger 604
G400
MidsizeCross Section Comparison
Large – Cross Section Comparison Source: Conklin & de Decker’s “The Aircraft Comparator”
Interior Configuration Interior Configuration
Interior Configuration Interior Configuration
Galley
Interior Configuration Interior Configuration
First Seating Area
Interior Configuration Interior Configuration
Second Seating Area
Interior Configuration Interior Configuration
Third Seating Area
Interior Configuration Interior Configuration
Lavatory
PerformancePerformance
Range – As Projected North AmericaTakeoff at ISA Long Range Cruise85% annual winds10 pax @ 200 lbNBAA reservesAE 3007 A1E Engines
PerformancePerformance
Range – As Projected Latin AmericaTakeoff at ISA Long Range Cruise85% annual winds10 pax @ 200 lbNBAA reservesAE 3007 A1E Engines
PerformancePerformance
Range – As Projected EuropeTakeoff at ISA Long Range Cruise85% annual winds10 pax @ 200 lbNBAA reservesAE 3007 A1E Engines
PerformancePerformance
Range – As Projected Asia & AfricaTakeoff at ISA Long Range Cruise85% annual winds10 pax @ 200 lbNBAA reservesAE 3007 A1E Engines
Aircraft ReliabilityAircraft Reliability
Built to operate within typicalairline schedule of 2,500 – 3,000 hours per year:
- Minimum downtime for inspections
- Ease of maintenance
- High reliability
12 Operational Legacy
Over 600 planes of the same family flying across the globe
Aircraft Availability – Over 99%
Proven Aircraft Maturity
Product Enhance m e ntsProduct Enhance m e nts
R olls-Royce AE 30 0 7 A 1 E EngineR olls-Royce AE 30 0 7 A 1 E Engine
• Increased Thrust – 7%
• Improved Fuel Efficiency
• Improved Field Performance
• Improved Time to Climb
This New Engine Provides:
0
20
40
60
80
1 0 0
1 2 0
Takeoff Sideline A p p roach
Noi
se Lev
el (EPNd
B)
Cumulative
Stage IV requires a cumulative reduction of ten dB total with at least two dB in any two conditions combined.
Legacy Noise Levels
Stage IIIStage III
Stage III
0
50
1 0 0
1 5 0
2 0 0
2 5 0
3 0 0Stage IV
R olls-Royce AE 30 0 7 A 1 E EngineR olls-Royce AE 30 0 7 A 1 E Engine
Airframe Aerodynamic Improvements
Engine New A1E Engine
Avionics New EICAS Software Version
APU Model 500R
Interior New Options
Exterior Paint Best Warranty in the Industry
Product Enhance m e ntsProduct Enhance m e nts
Product Improvements
Progra m Enhance m e ntProgra m Enhance m e nt
Sales & Design Center
Aircraft CertificationAircraft Certification
Certification Completed
• FAA – September 2002
• JAA – July 2002
• CTA – December 2001
Legacy Market OutlookLegacy Market Outlook
10 year objectives:
• Produce & deliver 240Legacys
• Annually deliver between 24and 30 aircraft
• Average 10% Market shareof the supermidsize/large category
10 year objectives:
• Produce & deliver 240Legacys
• Annually deliver between 24and 30 aircraft
• Average 10% Market shareof the supermidsize/large category
Price - Executive Configuration $20,425,000*
* January 2002 Economic Conditions
Ideal balance between capability, cost, performance & price
Legacy ShuttleLegacy Shuttle
Seating Configurations
19 Seats at 19 Seats at 37 in Pitch37 in Pitch
31 Seats at 31 Seats at 36 in Pitch36 in Pitch
37 Seats at 37 Seats at 31 in Pitch31 in Pitch
Interior ConfigurationInterior Configuration
Low Density Version
Interior ConfigurationInterior Configuration
High Density Version
Interior Configuration Interior Configuration
F o r w a r d-Facing Galley Aft-Facing Galley Lavatory
Range – Shuttle (Low Density Version)
Takeoff at ISA +20Mach 0.7885% annual winds18 pax @ 200 lbNBAA reservesAE 3007 A1/3 Engines
PerformancePerformance
Price - Corporate Shuttle US$ 17,100,000*
* January 2002 Economic Conditions
Making good business sense
Changing expectations of what a business jet should be