Still a favored perk of executives, the corporate jet has quickly become a symbol of excess. Yet as troubled corporations try to unload their fleets to stem the public relations headaches, the wreckage may lead to the discovery of still another crash: the manufacturers of business jets themselves.
Amid strikes at manufacturing giants like Boeing
Bombardier's LearJet and Challenger programs are facing job cuts totaling more than 1,300 employees as demand falls, while Cessna Aircraft parent Textron
An idea takes wing
As the inventory of late-model used planes climbs and utilization rates show marked reductions, manufacturers and parts makers are feeling the decompression occurring in the industry. Cabin interior manufacturer BE Aerospace
This might lead investors to think that those who arrange for jet-sharing among executives could see business soar. That would be companies such as Berkshire Hathaway's
Off the tarmac
Warren Buffett once disparaged the notion of investing in airlines, saying he'd need to enroll in a 12-step program if he ever caught the bug again. Investors might want to apply that thinking to the plane manufacturers, too. While depressed valuations make it seem like their shares could take flight, industry trends suggest the plane makers may instead encounter turbulence. Investors deciding to wing it anyway better hope their companies have a pilot like Chesley Sullenberger in the cockpit in the event they have to ditch into the Hudson.
Berkshire Hathaway is a Motley Fool Inside Value selection as well as a Motley Fool Stock Advisor pick. The Fool owns shares of Berkshire Hathaway. Try any of our Foolish newsletters today, free for 30 days.
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