Slowdown in Bizjet Sales, Increase in Military Spending, and Crackdowns on Aviation Abroad
Dassault's latest half-year profit update has a handful of interesting tidbits surrounding the current state of the international aircraft manufacturing industry, from arms sales and fighter programs to a slowing bizjet market.
Unsurprisingly, the grinding land war in Ukraine took top billing, with Dassault staff overall content to see the expected surge in arms sales. The most recent news from the firm's military arm is the sale of the Navalized Rafale to the Indian navy, with 26 sold to join the 36 fighters already in use with the country's Air Force. Additional news touched on a completion of the Rafale F4 standard by 2026, as well as the development of F5. That one will be interesting, including a Rafale-derived drone. Finally, Dassault teased a bit of their Future Combat Air System, noting that the design facility had been established and work begun last March.
On the civilian side, Dassault noted a "slowdown in sales since the end of 2022", with only a dozen orders received to 41 throughout the same span last year. Deliveries weren't as stressful to see, with 9 aircraft delivered to 14 in the first half of 2022. The firm remains optimistic, with the continued development of the Falcon 10X and impending certification of the Falcon 6X.
Finally, the most interesting aspect of the presentation lay in the contrast between the American and European markets to a globe-spanning manufacturer like Dassault. As the business aviation market has made strides in decarbonizing, Euro legislators have sought to increasingly tighten the noose. A telling phrase marks one of Dassault's slides: "The United States is in incentive mode, Europe is in hyper-regulation mode". They note that "a year’s use of the 2,100 Falcons currently in service is equivalent to 24 hours of global video streaming, 5 hours of global HGV traffic or 2.5 days of German power plant operation." The business aviation industry has already begun making headway on its goal to be fully carbon neutral by 2050, with nearly every major OEM devoting considerable attention to certifying their aircraft for use with Sustainable Aviation Fuel.
"Business Aviation," Dassault notes, "is excluded from the 'green' taxonomy unlike commercial aviation." They won't lay down without a fight, at least, adding that "legal action is under consideration" over the industry's treatment compared to larger carriers. Should they pursue a fight in court, they may put forth the argument that overly harsh demands on the business aviation market "breach the principle of equality while business aviation has begun its decarbonization." The market accounts from only 2% of global aviation carbon emissions, after all. With increased SAF use and improved aerodynamics on future Falcon jets, things are only getting more sustainable around the Dassault brand.
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