Gulfstream Anticipates A Big Year

Delays in FAA certification for the Gulfstream G700 “deprived” parent company General Dynamics of $1 billion in revenues and $250 million in earnings last year at its aerospace division, General Dynamics chairman and CEO Phebe Novakovic said recently during the company’s fourth-quarter and full-year 2023 investor call. The company had planned for FAA approval and deliveries of 15 G700s last month, which didn’t materialize due to circumstances “outside of our control,” she said, referring to the U.S. agency and implying a longer certification process because of the Boeing Max debacle. Customers of these 15 G700s were told earlier this week to prepare for deliveries in the current quarter.

Last year, Gulfstream delivered 111 jets (89 large-cabin and 22 super-midsize G280s), down from 120 (96 large-cabin and 24 G280s) in 2022 and missing its downgraded 2023 estimate of between 133 and 135 aircraft. Still, General Dynamics' aerospace division, which includes Gulfstream and Jet Aviation, saw year-over-year increases of about $50 million in both revenues and earnings, to $8.621 billion and $1.182 billion, respectively.

Aerospace backlog climbed to $20.454 billion as of December 31, up from $19.516 billion a year earlier. Novakovic said the Gulfstream sales pipeline remains “robust and wholesome” and noted that the aerospace division’s book-to-bill ratio was 1.2:1 last year.

Looking ahead, the General Dynamics chief said Gulfstream is poised to deliver 160 jets this year, including 50 G700s and fewer G280s, due to the conflict in Gaza (G280s are manufactured for Gulfstream by IAI in Tel Aviv). Aerospace revenues and earnings are predicted to soar by 12 and 33 percent, respectively, in 2024, she said.