A market indicator, and one company recovers from FAA hell ...
In economic times such as these, one indicator of the marketplace is what’s going on with used aircraft. On page 18, Greg Duckson of General Aviation Services offers some perspective. Bottom line: It’s tough out there.
Financing is central to any recovery. Explains Duckson, “People just don’t feel good about spending right now. I had a very high net worth individual call me and he said he was thinking about taking $100 million and buying up a bunch of airplanes and putting them in a hangar, and then wait for it to come around in a couple of years. That may be a better deal than putting the $100 million in a bank.
“I think he does have a point. The only problem with that is that airplanes need to be flown. There’s still a cost of sitting in a hangar. When buyers look at an airplane that’s been sitting around for three years, there’s a lot of hesitation.”
Then there is the subject of high-mileage aircraft, such as those flown by the fractionals. Where is that used market going to fall out?
Says Duckson, “There will be a market for them. But what happens is, say with a Hawker 800, maybe the average time is 7,000-8,000 hours and these have 13-14,000 hours. It sets a different price level within that market. It’s going to be a tradeoff. Do I buy an older Hawker 700? Or do I buy a newer Hawker 800 with a bunch of time on it? There’s a tradeoff there. It depends upon the buyer.
“For most retail buyers there’s an issue with 10,000 hours — that last digit still looks to be too much. So the difference between a 9,000-hour airplane and an 11,000-hour airplane is actually probably quite a bit; more so than between 7,000 and 9,000 hours.
“Perception is everything; it’s the same metal, the same technology. “
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Back in 2005, I did a business profile on Air Trek, an air ambulance firm based at Punta Gorda, FL ... on the strong recommendation of an industry insider. Wayne and Dana Carr ran what appeared to be a first-class operation.
Then FAA stepped in, and ultimately shut the company down.
On August 27, an NTSB administrative law judge ordered FAA to pay Air Trek $120,169 for attorney fees and expenses pursuant to the action. That followed rulings in which Air Trek was essentially found innocent of any significant charges.
Now that the company is back in operation, I asked Dana Carr for his thoughts. To wit ...
“I recall the worst part of this nightmare was laying off 65 people whom depended on Air Trek for a paycheck.
“I have also found many in FAA whom are fed up with the constant demand from the top to ‘go for the head shot’ when a better resolve may be mentoring and education.
“One point I would like to highlight is the support from NBAA and NATA; they helped from the beginning. Our resolve would not have endured without their encouragement.”
Thanks for reading.
