October 15, 2018 / 8:54 PM / a month ago

Textron, NetJets strike deal for up to 325 Cessna planes

ORLANDO, Fla. (Reuters) - NetJets, the luxury plane unit of Warren Buffett’s Berkshire Hathaway Inc (BRKa.N), announced a deal on Monday to purchase up to 325 Cessna Citation business jets from Textron Inc’s (TXT.N) aviation unit, one of the biggest orders unveiled at a major jet show this week in Orlando, Florida.

FILE PHOTO: The interior of the Cessna Citation Longitude jet is seen during a tour of the Cessna business jet assembly line at their manufacturing plant in Wichita, Kansas August 14, 2012. REUTERS/Jeff Tuttle/File Photo

Rob Scholl, a spokesman for Textron Aviation, said he expects NetJets to firm up the orders for up to 175 super-midsize Cessna Citation Longitude aircraft and up to 150 Cessna Citation Hemisphere aircraft in the coming weeks.

Deliveries are expected in the fourth quarter of 2019.

In a statement, NetJets said the Textron agreement could increase its Cessna Citations fleet, which it has operated since 1984, to more than 800 aircraft over the next 10 to 15 years.

The Longitude will compete with the new longer-range, midsized Praetors launched by Embraer SA (EMBR3.SA) on Sunday and Bombardier Inc’s (BBDb.TO) Challenger 350 and 650 aircraft.

Planemakers and buyers were buzzing about the deal as they arrived in Orlando for the National Business Aviation Association’s flagship annual corporate jet show, which begins on Tuesday.

Demand for luxury aircraft is seen rising thanks to a strong economy and tax cuts in the United States, the world’s largest market for private planes.

The NetJets agreement is good news for French engine maker Safran SA (SAF.PA), which has relied on sales of Cessna’s Hemisphere aircraft, the newest member of the Citation jet family, for its Silvercrest engine.

“NetJets is the market leader and gives a great deal of credibility to the aircraft and the engine,” Olivier Andries, chief executive of Safran Aircraft Engines, told Reuters by telephone.

Development of the already-delayed engine was thrown off course last year when Safran reported a problem with a compressor during certain types of high-altitude test-flying.

Safran has started producing redesigned parts and will start assembling them in early 2019, followed by ground tests during the second quarter to ensure the solution is working, Andries said.

Last month Safran reached a financial settlement with French planemaker Dassault Aviation SA (AVMD.PA), which scrapped plans for a new aircraft that was due to have been powered by Silvercrest. Dassault replaced the plan with a new model, the Falcon 6X, powered by engines built by Pratt & Whitney Canada, a unit of United Technologies Corp (UTX.N).

Dassault unveiled further details of the relaunched Falcon 6X in Orlando on Monday.

Reporting by Allison Lampert in Orlando, Fla.; Additional reporting by Tim Hepher in Paris; Writing by Tracy Rucinski; Editing by David Gregorio and Matthew Lewis

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