FBO Report

FBO Report

A canvass of operators reveals that business is good, but filling employee positions is a common challenge

BY John Boyce, Contributing Editor

June 1999

Business activity is so good in the FBO industry that finding people to handle the business has reached, at least in some areas, critical proportions. Fixed base operators report that sales in all segments of the industry continue to be strong, particularly jet fuel sales. But the optimism that good business breeds is clouded by a shortage of personnel to do the job.

For instance, Tim Hilde, president of aircraft operations at Western Aircraft in Boise, ID, reports that business has been "phenomenal" but feels fortunate to be only ten maintenance technicians short of a full complement.

"It's an acute problem," Hilde says. "We've gone from eight mechanics two years ago to over 40 now. We're still looking for another ten.... The biggest problem is getting technicians."

Vince Dugan, VP of Trego-Dugan Aviation in North Platte, NE, fairly echoes comments of colleagues regarding activity: "There's greater use of corporate jets, and that has significantly impacted us as a mid-continent refueler. We've had significant increases in jet fuel sales and significant decreases in 100 low lead sales. There are fewer and fewer piston airplanes out there and more and more turbines. I expect that to continue. And that has impacted the type of equipment we buy nowadays. We've purchased three new refuelers in the past three years, two of which are jet refuelers."

While the increase in business and the shortage of personnel dominated conversations about the state of the FBO industry for this article, there were some other important issues on the minds of operators. Among those are the ongoing need to educate communities on the benefits of general aviation to, among other things, offset anti-airport groups; uncertainty about user fees; relations with airport owners; and fractional ownership.

WIDESPREAD SHORTAGES
Clearly, reports from around the country indicate that the overall demand for maintenance and avionics technicians is far outstripping supply, both of new and experienced people (related article, page 22). However, there appears to be shortages in personnel in all segments of the FBO business including, in some areas, pilots for flight instruction.

"Hiring is a real problem," says Tom Ransom, vice president and general manager at Avitat/Qualitron at Houston's Intercontinental Airport. "Here in Houston it's been a real problem because of the markets."

Even if there was a sufficient supply of incoming A&P technicians, companies with a commitment to aircraft maintenance find themselves struggling to maintain a balance between experienced and inexperienced personnel. "Everybody who is worth anything is being scarfed up by the highest bidder," says Stephen Lord, VP of general aviation services at Wiggins Airways in Manchester, NH. "It's hard with the airlines hiring."

Lord says the airlines lure experienced mechanics away with substantially higher wages than he is able to pay. Consequently, he finds himself, albeit reluctantly, in a food chain-like situation where he, in turn, has to lure personnel from smaller FBOs.

Explains Lord, "We certainly work with the tech schools to get people out of school, but we need to keep a delicate balance so that we don't end up with too big an imbalance between experienced and new people. We end up on the food chain; we get (personnel) from the smaller FBOs that maybe can't pay as much. That gets those owners angry, but I have to stay in business and satisfy my customers."

STRATEGIES FOR THE PROBLEM
What Lord does is widespread in the industry (and most industries, for that matter); it's one of the ways things work. But Hilde at Western says, "We can only steal from each other for so long; we're going to have to grow our own." He has taken steps to do just that in maintenance and line service. Western has developed a matrix with different grade levels of technicians and line personnel and a matching pay matrix (see sidebar).