Once again the mood was aggressively optimistic at this year's 59th Annual Meeting & Convention held by the National Business Aviation Association here in October. Honda announces orders for more than 100 of its new HondaJet VLJ (very light jet); Cessna , Embraer, and Raytheon announce bullish orders for aircraft; and, even Piper is getting ready to enter the light single-engine jet market. Among airport-based businesses, the temperature is just as hot, with growth through acquisition still topical despite a seller's market, say officials. And, the business buzz phrase for this year's show - integrated solutions - reflects an increasing focus on growing aviation businesses from within.
In recent years the annual NBAA show has been extremely vibrant. To say that the 2006 event was perhaps even moreso would not be an understatement. To wit: Honeywell Aerospace, in its annual forecast, projects another 12,000 business aircraft will enter the market, at a value of some $195 million, over the next ten years.
In all, some 33,088 persons attended this year's NBAA event, a record, with some 1,140 exhibitors and 117 aircraft lined up at the annual static display hosted at the Orlando Executive Airport.
FBOs contacted at this year's event say they experienced a slight downturn in business aviation activity in the first quarter, and most attributed it to an apprehension on the part of corporates in light of rising fuel prices. Once March arrived, they say, with the economy chugging along, corporate operators got back into their aircraft again.
Bruce Van Allen, CEO of the Signature Flight Support chain of aviation service companies, says that the resiliency demonstrated by business aviation despite volatility in the fuel markets reflects a "sustainability" of the current business aviation environment.
The primary negative facing the business aviation sector, as presented in a key discussion forum of industry and government officials, is the pending reauthorization of how the Federal Aviation Administration, the air traffic control system, and the airport infrastructure programs are funded. Current funding authorization ends September 30, 2007.
At the center of that debate is the Air Tranport Association's call for new "user fees" for business aircraft - a time in system formula. NBAA and other general aviation groups maintain that the current fuel excise taxes paid by GA are the fairest way for the segment to pay for its use of the U.S. aviation system.
At the center of the debate is the future of the U.S. air traffic control system, which ATA would like to see pulled out of FAA as part of its call for a more vigorous modernization initiative.
Among the major FBO chains inteviewed in Orlando, all remain bullish about market prospects as well. They report an ongoing interest in growing through acquisition, both domestically and internationally. However, the acquisition market may cool due to a seller's market.
Comments Jim Hopkins, VP of FBO operations for the Landmark chain of FBOs and maintenance centers, "Right now the market is a little pricey. There are a lot of buyers out there," which, he says, suggests some may be overpaying for acquisitions that could lead to negative market forces down the road.
Among the business leaders here the term "integrated solutions" has become part of the new vernacular, with larger companies in particular eager to sell all of their respective services to every customer. A fuel customer is also a potential maintenance, charter, or avionics customer, or perhaps even a subtenant.
For Hopkins at Landmark, it means educating every employee at every base about company services offered at each of its locations - both FBOs and maintenance centers. It's a way of "owning the airport," he explains. "We want to know every aircraft based at our airports, from Bonanzas to Boeings. And we're making our people smarter and more versatile."
Interviews, press conference reports, and news briefs from NBAA 2002 ORLANDO – After settling for an abbreviated show in 2001, the National Business Aviation Association was determined to...