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Rockwell Collins says that the Business Jet market has hit rock bottom

Rockwell Collins Inc., the aerospace supplier, says that it is hitting the bottom of a painful slump in the business jet market.

Last Thursday, the company said that the forecast for fiscal 2009 earnings would fall in the range of $3.70 to $3.90 per share after several cutbacks in its outlook in the previous quarters.

In a related interview, Clay Jones, chairman and CEO, said that company clients like Boeing and Airbus may need to cut production on narrow-body aircraft as airlines downsize and conserve cash to cope with decreasing global passenger traffic.

“Boeing and Airbus have bent over backwards to explain to us how they can maintain production rates,” said Jones. However, he also mentioned that he is uncertain. Both airplane manufacturers have had cuts in production, but have maintained manufacturing plans by shifting orders among their customers.

“They know more about their customers than I do,” explains Jones. “It could be they expect to see strong demand for more fuel-efficient aircraft” despite the recession.

He said that Rockwell Collins will be keeping a close eye on production cuts. According to Jones, production cuts would give Rockwell plenty of lead time to adjust its pipeline.

Source: ForexGen