NBAA '12 Annual Conference Report

Operators share views on the state of the industry, bizav activity


ORLANDO — Attendance was down at the National Business Aviation Association’s (NBAA) 65th Annual Meeting & Convention held here in late October, but much of that was due to a temporary flight restriction for a presidential visit to the city, and a dangerous Hurricane Sandy striking the East Coast and preventing many potential attendees from flying South.

According to NBAA, 25,250 people attended and 1,073 companies exhibited — down slightly compared with the 2011 event. For the most part, cautious optimism remains apparant as FBOs look to climb back to pre-recession activity levels at many locations.

In some cases, having a diverse product base has insulated operators from the effects of the downturn; and in many cases, fuel sales and aircraft activity has not yet returned to pre-recession levels.

Comments Bernie Klotz, owner, J.A. Air Center at Aurora Municipal Airport (located some 50 miles west of Chicago), “Right now, avionics is the most successful profit center for us, followed by fuel.

“The FBO is during very well. On the maintenance side, we have stayed alive mainly because of airplanes we have bought and modified … a lot of work was done internally, and then the planes were sold off.”

Maintenance is picking up, relates Klotz. The company has recently opened an interiors shop.

“We had to be very cautious of what we did. It was difficult because we had to use a lot of our financial capability to stay alive that first year of the recession.

“When you take nine departments … at the end of the day, the strengths are in our full-service capabilities, and the diversification of our service offerings.”

Brian Kirkdoffer, senior management for Clay Lacy Aviation, remarks, “In terms of fuel, the business is kind of flat; we are now on the third year of that.

“We have a lot of other lines of business; for us that has worked out very well. We do maintenance, jet charter, management, interiors … we are fully invested in aviation, but across different product lines.”

Aircraft management and maintenance have been the most successful of the products lately, adds Kirkdoffer.

“Revenues are back to pre-recession levels; we are fortunate. We are back from a volume standpoint, but not necessarily from a profitability standpoint. To keep market share, you’ve had to squeeze profits.”

Remarks David Ivey, VP, Wilson Air Center, “At the Houston location, and not just with Wilson Air Center, but we are evidencing a return to pre-recession levels with the entire Eastern Aviation Fuels market there.

“Memphis is flat, on the other hand. We aren’t getting any worse, but we are not getting any better.

“Over the past four and five years, we have expanded into other areas to gain additional revenue, such as airline deicing. We are opportunistic. We did downsize headcount-wise some during the recession.”

Ivey anticipates 2013 will consist of low single-digit increases in fuel deliveries.

Robert Stallings, president of Eastern Aviation Fuels, relates that business is definitely not back to where it was before the recession. “It really depends on the FBO; some FBOs are getting by on the customer base they have,” he says. “We are cautiously optimistic.”

David Bird, executive director for the Dupage Airport Authority, says the consistency of the business just hasn’t been there. “It’s been very up and down,” he explains. “We are not back to pre-recession levels. The good thing is, it looks like for 2012, you are either going to stay at 2011 levels, or see a small increase ... but we are not seeing any additional drops.

“At Dupage, we are starting to see movement again.”

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