Cessna Citation M2 Makes Debut

In late September, Cessna introduced the Citation M2, a less-expensive and more-capable version of the CJ1+ that’s intended to be a more attractive intermediate step up in speed, range and cabin comfort that will be positioned between the Citation Mustang and the CJ2+. The new design has been in development for three years and it’s slated to fly during the first half of 2012.

The M2 announcement is especially propitious for company President and CEO Scott Ernest. It’s Cessna’s first new model announcement since he was tapped in May by Scott Donnelly, chairman and CEO of Textron, Cessna’s parent, to take over the Wichita subsidiary.

Donnelly said he chose Ernest because of his “strong expertise in the aviation industry. Accelerating Cessna’s new product and service development . . . [is] key to moving Cessna forward,” he added.

Achieving those goals, among others, could be challenging considering that Donnelly’s first priority for Ernest is to slash production and supply chain costs at Cessna, and hopefully return the company to profitability. But without new products to stimulate increased sales it’s doubtful that Ernest can boost Cessna’s bottom line solely by cost cutting.

Deliveries of Cessna’s existing Citation lineup have been especially hard hit during the severe depression in the light jet market that began three years ago. In 2008, Cessna delivered 466 Citations, achieving a 10-year high. That fell to 289 shipments in 2009 and 178 deliveries in 2010, according to GAMA statistics. The company is on track to deliver 138 Citations in 2011 based upon shipments in the first half of 2011.

Deliveries of the CJ1+, the M2’s predecessor, were devastated in the past three years. Cessna shipped 20 units in 2008, then 14 in 2009 and three in 2010. It only delivered one CJ1+ in the first half of this year.

Cessna’s misfortunes have come during a time period when archrival Embraer has made impressive gains in the light jet market, winning over many customers who otherwise might have purchased the Mustang or CJ1+. The Brazilian firm’s Phenom 100 entered service in December 2008, offering a larger cabin, virtually the same tanks-full payload and highly competitive range. The Phenom 100 was initially priced just $500,000 more than the Mustang and a whopping $1.2 million less than the CJ1+. Its perceived bargain price made its sales soar.

The Phenom 100’s innovative wide-oval cross section, large-screen Garmin G1000 avionics and exceptional fuel efficiency indeed attracted plenty of early customers. Embraer delivered two aircraft in late 2008, then 97 units in 2009 and 100 units in 2010, according to GAMA. But that two-year surge now has ebbed. In the first half of 2011, Embraer delivered only a dozen Phenom 100s.

Cessna believes the current lull in Phenom 100 deliveries is an ideal time to regain market share by announcing the M2, which is intended to be more competitive with the Brazilian light jet. While the M2 will have the same cabin dimensions as the CJ1+, it will climb quicker and cruise up to 11 kt. faster than its predecessor. With a single pilot and a 500-lb. payload, it should be able to fly 1,300 nm and land with 100-nm NBAA IFR reserves, according to Cessna’s projections. The M2 will be priced at $4.195 million, with the first 47 aircraft priced at $4 million, according to CEO Scott Ernest.

The M2’s sticker price still will be roughly $285,000 higher than the Phenom 100, but it will offer better hot-and-high airport performance, up to 35 kt. higher cruise speeds and 100 nm more range, based upon our estimates. Notably, Cessna quotes range performance at high-speed cruise. Embraer’s range numbers are based upon throttling back to long-range cruise.

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