BOSTON, Nov 5 (Reuters) - Shares of Textron Inc (TXT.N) fell 7 percent on Wednesday after the world’s largest maker of corporate jets cut its forecast for Cessna Citation jet deliveries in 2009.
“Frankly, the degree and speed of disruption in the marketplace in the last two months and particularly in the last several weeks has been unprecedented,” Lewis Campbell, chairman and chief executive said in a presentation to investors on Wednesday. “The current situation has developed very rapidly as a result of a single factor ... and that factor is the availability of customer finance.”
Textron after the market close on Tuesday warned Wall Street that it now expects its Cessna jet unit to deliver only “slightly” more of its Citation range of business jets next year than the 475 planned for this year. That was a far more conservative view than its earlier forecast of 535 jets for 2009.
Analysts described Textron’s forecast cut -- and scaling back of production plans -- as an expected move in light of the global economic crisis.
“This announcement acknowledges the fast deterioration of the market,” wrote Morgan Stanley analyst Heidi Wood, in a note to clients. “There remains risk of further revisions to the production schedule but now management’s guidance is much more credible and realistic, we believe.”
Textron shares fell $1.31 to $17.33 on the New York Stock Exchange. The stock has lost about 75 percent of its value so far this year, a far steeper drop than the 40 percent slide of the Standard & Poor’s capital goods industry index .GPSIC.
Declining demand for corporate and private jets is bad news for Cessna’s rivals, including Canada’s Bombardier Inc (BBDb.TO), the Gulfstream unit of General Dynamics Corp (GD.N) and France’s Dassault (AVMD.PA). (Reporting by Scott Malone, editing by Dave Zimmerman)