(Adds General Dynamics comment, stock price, byline)
By Chelsea Emery
NEW YORK, June 20 NetJets, a provider of
private planes, will buy 40 new Gulfstream aircraft from a unit
of General Dynamics Corp (GD.N) in a deal worth about $1.9
billion, the companies said on Friday.
The purchase of new planes comes as U.S. commercial
airlines are grounding planes and slashing routes amid
skyrocketing fuel prices. Delta Air Lines Inc (DAL.N), for one,
has said it will cut domestic capacity by about 13 percent in
the second half of the year.
NetJets sells fractional aircraft ownership, an arrangement
that allows individuals and corporations to buy a share of a
private business jet for less than the cost of buying a plane.
The Berkshire Hathaway Inc (BRKa.N) company is the world's
largest operator of Gulfstream aircraft.
Sales at the General Dynamics aerospace unit, which makes
Gulfstream jets, soared 17 percent in the first quarter from
the year-ago quarter.
"That suggests that demand continues to be strong," said
Rob Doolittle, a spokesman for General Dynamics, adding that
demand from non-North American consumers for large-cabin
business jets was climbing.
The deal calls for four Gulfstream G450s and four
Gulfstream G550s to be delivered each year from 2012 through
2016. The arrangement also includes more than $250 million in
long-term maintenance support.
"This contract recognizes the continued success of
Gulfstream aircraft in the NetJets fractional ownership program
and the strong partnership between the two companies," Joe
Lombardo, president of Gulfstream Aerospace, said in a
Oil prices are up about 40 percent so far this year.
Shares of General Dynamics closed down $2.09 at $85.50 on
the New York Stock Exchange on Friday.
(Reporting by Chelsea Emery; Editing by Andre Grenon, Toni