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9 8000 7000 Beechcraft Premier IA (J) King Air 350 (T) 6000 Cessna CJ2+ (J) King Air 200 (T) Actual Price ($000) 5000 Cessna CJ1+ (J) 4000 Embraer Phenom 100 King Air 90 (T) (VLJ) 3000 Piper Malibu Meridian Citation Mustang (VLJ) (T) Eclipse 500 (VLJ) 2000 208B Grand Caravan (T) Baron G58 (P) 1000 Cessna 400 (P) Cirrus SR22 (P) 0 0 1000 2000 3000 4000 5000 6000 7000 8000 Expected Price ($000) Figure 5. VLJs added to the product space. in the product space. In the case of VLJs, this may be seen by turboprop and light jet segments. It is possible that the new observing their performance characteristics and plotting their VLJ segment may expand the size of the overall GA market. As price points on the same graph, as shown in Figure 5. discussed earlier, the evidence from 2000 to 2007 shows that This exercise suggests that VLJs may indeed be able to gar- the GA market was driven primarily by changes in aggregate ner significant sales for two reasons: they are priced well economic activity rather than by the composition of existing below the expected price line given their performance char- models or the introduction of new models, so it is believed acteristics and they occupy a relatively empty area in the that any expansion of the overall GA market due strictly to the product space, although closer to turboprops and light jets introduction of VLJs will be limited. By similar reasoning, than to pistons.6 neither the low end segment of the piston market nor the mid- In terms of a shipment forecast, Figure 5 suggests that, at a to large-sized corporate jet market will likely be affected much minimum, VLJs should be able to produce as many ship- by the introduction of VLJs since both markets really serve dif- ments as the turboprop segment since their actual prices ferent clientele. overlap with each other but the VLJs (on average) offer bet- ter performance characteristics. Recalling Figure 3, it is believed that the fairly constant 200300 annual shipments produced by Outlook for VLJ Manufacturers the turboprop segment should be easily reachable. On the other Actual VLJ shipments observed over the next several years hand, just based on the price differential alone, it is not likely will depend heavily on the actual progress made in develop- that the demand for VLJs for personal, private, and corporate ment, certification, and production capabilities of the various use will come anywhere close to the 700900 units achieved by VLJ programs that currently exist. This section has been up- the high-end piston segment. dated to account for important recent developments in An important question is the extent to which sales of VLJs these programs; the following fleet forecasts presented will cut into sales in the high-end piston segment and/or the below, which were completed in the Fall of 2008, do not fully reflect these events. 6 Single-engine VLJ models have not been included in this analysis be- cause their price and performance specifications are still too uncertain. The Diamond D-Jet, whose development is furthest along, appears to Eclipse 500 be most similar to the smallest of the twin-engine VLJs--the Eclipse-- Eclipse Aviation originated the VLJ segment more than albeit with a significantly slower cruise speed and an uncertain price. Diamond has announced that it will be increasing its price for the jet 10 years ago. The Eclipse 500 was certified in late 2006 and re- because of the recent change in engines, but it has not announced the ceived its FAA production certificate in the spring of 2007. An exact increase. updated avionics package was certified at the end of 2007.