Industry Meets in Vegas: The overriding message at this year's NBAA convention: guarded optimism

NBAA Follow-Up Industry Meets in Vegas The overriding message at this year’s NBAA convention: guarded optimism. By John F. Infanger and Jodi Richards November/December 2004 LAS VEGAS — Aircraft manufacturers — usually the...


LAS VEGAS — Aircraft manufacturers — usually the horsethe industry rides in terms of an industry barometer — at this year’sNational Business Aviation Association convention were upbeat, but unveiledfew new models and did not have the onslaught of orders as in past years. It was indicative of the mood of business aviation: optimistic as most companies are experiencing an uptick in activity after several years of little growth, but guarded. This seems particularly true with maintenance, where customers who have put off work on their aircraft are now showing up on ramps. On the FBO side, Garrett/Piedmont Hawthorne/Associated made the biggest headlines, forming a new nationwide venture.

The 2004 NBAA convention attracted a record 1,084 exhibiting companies, covering a million square feet of floor space. Attendance was officially 31,259, not far off from the record of 31,665 set in 1998. This year’s static display was hosted at Henderson Executive Airport, with some 87 aircraft on display.

New NBAA president Ed Bolen was upbeat, inspired by recent upturns by the aircraft manufacturers who have been recording higher shipment and billing numbers lately.

More specifically, Bolen cites the acceleration of bonus depreciation of large capital assets, including aircraft, as partly responsible for the rebound in the manufacturing sector. Bolen remains optimistic that such depreciation will be extended through January, 2006, as indicated by the U.S. Senate’s passage of legislation recently to that effect.

News From the OEMS
News from the aircraft manufacturers was led by the newcomer in the industry, Eclipse Aviation Corporation, one of the leading microjet — or entry level jet — OEMs. Eclipse president Vern Raburn reports that the company is on track to certify and deliver the Eclipse 500 by the first quarter of 2006. He says the company expects to deliver some 260 Eclipse 500s in the first 12 months of production, and a total of 880 units within two years after certification.

According to Raburn, Eclipse plans to open seven service centers by 2008, with the first two being in Albuquerque (company headquarters) and Gainesville, FL. The company is also implementing a training program for technicians that will lead to “authorized repair technician” designation.

Other news from the OEMs:

  • Boeing Business Jets says it has orders for five new units and reports the biggest obstacle in getting new business comes from competition in-house for 737s off the production line. Says president Steven Hill, “It’s not the market that’s holding us back.”
  • Bombardier Aerospace reports it has returned to profitability, with income of $23 million in the second quarter on revenues of $3.9 billion. The company introduced the new Learjet 40 XR, an enhanced Lear 40 model that has an extended range of some 936 nautical miles.
  • Cessna Aircraft Company, often the leader at NBAA events, unveiled the Citation CJ2+ and CJ1+ models. Cessna also reports that its microjet entry, the Mustang, is in the initial assembly stage and is on track for a late 2006 delivery schedule.

Composite drawing of the new FBO being built at LAX 
by Mercury Air Centers.

Composite drawing of the new FBO being built at LAX by Mercury Air Centers.

collage of planesjet props

On the FBO Side
Among fixed base operators, the biggest news came from the new jointly formed Garrett/Piedmont Hawthorne/Associated and from Mercury Air Centers, now under new ownership.

Garrett/Piedmont Hawthorne/Associated is the result of the recent merger of Garrett Aviation Services, Piedmont Hawthorne, and Associated Air Center, created following the acquisition of Garrett by the Carlyle Group, a private investment firm. The company will be headquartered in Tempe, AZ. Frank Klaus, formerly with Garrett, is the new president/CEO; Dean Harton of Piedmont Hawthorne becomes vice chairman; and, Shawn Vick is the executive vice president, having served previously with Bombardier and Gulfstream.

Says Vick, “This is a chance to change the game in business aviation services.” The combined company, which is exploring a simpler name change, now offers services to all levels of aircraft, including airliner maintenance, and has a nationwide network of some 33 FBOs. It is building a new FBO at Los Angeles International; has relocated its FBO at Raleigh Durham; and is upgrading facilities at Roanoke, VA, and Dallas Love Field.

Mercury Air Centers, which recently came under new ownership by Allied Capital, a publicly traded investment firm based in Washington, D.C., reports it too is building a new FBO at LAX as well as a significant upgrade at John’s Island, SC.

Mercury has contracted with Ritz Carlton to improve customer service training at the FBO chain, and has entered into an agreement with TAG Aviation to be able to offer executive charter services through its FBOs.

President John Enticknap says the company will continue to be aggressive in the FBO acquisition market. “We have access to the capital markets,” he explains, “which we did not have before. It’s quite a change for Mercury.”

NBAA BRIEFINGS ...

AIRBUS CORPORATE JETLINER — has a new network of servicecenters, specializing in executive and private aviation: AssociatedAir Center of Dallas; Jet Aviation; Qatar Airways of Doha, Qatar;and, TAM Jatos Executivos of Sao Paulo.

AIRCRAFT SHOPPER ONLINE — (ASO) launches a website for buyers and sellers of pre-owned aircraft; www.ASO.com.

AIR SECURITY INTERNATIONAL — offers a new and expandedratings system, The Airline Insider, with in-depth reports ofsome 250 airlines worldwide that provide security and safetyinformation.

ARINC — receives FAA Designated Alternation Stations authorization to its Aircraft Services organization based in Colorado Springs. It’s only the fifth such DAS award to a third-party provider of business aircraft repairs and modifications.

BE A PILOT — reports that its 2004 TV ad campaign hasgenerated 22,837 pilot prospects through October 3, topping 2003results.

CAE SIMUFLITE — announces it will open a new business aviation training center in the New York/New Jersey area, expected to be operational by summer 2006.

CONKLIN & DE DECKER — releases the 42nd edition ofits Aircraft Cost Evaluator.

DUKES TRANSPORTATION SERVICES, INC. — forms a joint venture with Titan-Aviation, SA of Lyon France called Dukes-Titan-Systems LLC.

EXECAIRE — a Canadian aircraft management company, addsan executive Bell 427 twin-engine helicopter to its fleet ofmanaged aircraft.

EXECUTIVE JET MANAGEMENT — reports a nearly 38 percent increase in charter activity during the first half of 2004, compared to the same period last year.

HORIZON BUSINESS CON-CEPTS, INC. — announces its TotalFBO® Version4 has received online credit card authorization for AirBP, withdetailed receivables tracking of contract fuel sales. The softwareis already certified with Avfuel, Multi Service, Chevron, and Texaco.

METEORLOGIX — introduces MxVision Aviation Sentry™ Online. The pilot briefing system provides a range of weather graphics and flight planning tools. The service, which can be delivered through a high-speed Internet connection, allows pilots to receive briefings, file flight plans, and remain up to date on changing weather conditions.

MIDCOAST AVIATION — reports the completion of its $5 million,50,000-sq.ft. paint hangar in October at the St. Louis DowntownAirport.

MULTI SERVICE — receives Aviation Into-Plan Reimbursement (AIR) and Ships’ bunkers’ Easy Acquisition (SEA) Card Programs contract; relaunches its website, http://aviation.multiservice.com.

RAYTHEON AIRCRAFT COMPANY — reports that the governmentof Israel has purchased 18 Beechcraft Bonanzas.

SHELL AVIATION — announces the upcoming launch of the Shell Aviation Contract Fuel Program in the U.S., planned to be available in the first quarter of 2005.

UNIVERSAL WEATHER AND AVIATION, INC. — releases 2005 UVTripPlannerDirectory, a trip reference tool for business aviation.

Aviation News

NBAA announces that its 2005 convention will be held November 15-17 in New Orleans. In other association news:

  • NBAA reports that business aviation paid some $188 million in federal excise taxes for FY2001, an amount that equals 102 percent of costs identified by FAA for services rendered to the industry sector.
  • The association has created a Corporate Aviation Management Scholarship, which will enable selected candidates to attend the 2005 NBAA Leadership Conference in March.
  • NBAA will host regional forums next year in Morristown, NJ; San Jose, CA; Denver; and, Atlanta.

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