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."
Says, 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; we are a million gallons under our high.
"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. We are moving potentially three to four additional jets on the field in the next couple months."
Cutter Aviation Honored
At NBAA's 2012 annual conference held in Orlando, Cutter Aviation was recognized for its contributions to the aviation industry and for being the longest-running branded dealer in the Phillips 66 Aviation network. Cutter Aviation started selling Phillips fuel at Albuquerque’s West Mesa Airport some 75 years ago.
Now an industry leader in the Southwest, Cutter’s impact has gone beyond the rural air charter business that began as William P. Cutter’s dream. Cutter Aviation’s reach now extends to seven major airports with facilities serving Phoenix Sky Harbor (PHX) and Phoenix Deer Valley (DVT), Colorado Springs (COS), El Paso (ELP), San Antonio (SAT), Dallas-McKinney (TKI) and Albuquerque (ABQ).
Airport Business caught up with president Will Cutter at the event and asked about business today. He comments, "Our fuel is about, gallon-wise, back to ’08 levels. We watched our costs real well, so we are doing OK in the fuel business.
"Aircraft sales have been real good for us this year; our Piper dealership is the top Piper dealership. So we are selling some airplanes, mainly because we are in Texas; it’s either oil or agriculture that’s buying all the airplanes. The used business is OK.
"And charter has been very strong. We are struggling in the maintenance world; we can’t get the volume to sustain enough mechanics to keep everything going good. As the fuel volume gets going and people are flying more, maintenance will catch up."
As a full-service aviation company, Cutter Aviation provides a range of GA services including: fuel and line service support, new and pre-owned aircraft sales, aircraft maintenance, avionics design/installation/repair, aircraft management services, and aircraft charter.
Join Us At AviationPros LIVE 2012 In Vegas
Boyd Group International To Provide Perspective On Key Issues
Michael Boyd, chairman of aviation consulting and research firm Boyd Group International, will deliver the keynote presentation at the AviationPros LIVE event in Las Vegas, NV, March 13-14, 2013.
Following is a breakdown of some of the content at this year's event targeted at business and general aviation professionals, and airport managers and directors:
The Restructuring Of Business Aviation
This sector of aviation is facing major changes in operating and business dynamics. As a key part of the national and international transportation and communication chains, the industry will have very different market applications than in the past. Boyd Group will cover these shifts on a futurist basis.
Transformation Of Rural Airports & Business Opportunities
As the raw economics of scheduled air transportation cause route systems to shrink, it is rural airports that will have a greater role in keeping entire sections of the nation connected to the national and international business base. This will mean that rural airports will need to re-think facility planning, financing, and competitive structures, based on the economic needs of the region they serve.
Expanding The Economic Impact And Economic Role
Every part of the industry — airports, OEMs, suppliers, vendors — are facing a situation where general and business aviation must deal with new regulatory and cost challenges at the same time that reductions in government spending is threatening basic infrastructure. Boyd Group will be keynoting the need to assure that the public more fully understands the enormous economic impact of this sector.
***
Sessions covering more granular areas of the challenges and opportunities facing the airport industry will focus on topics such as taxes and regulations, 100LL challenges and opportunities, and growth options for GA.
Please join us in Las Vegas this coming March for a comprehensive educational program and a resource rich exhibition hall.
For more information, and to register for the event, visit: http://aviationproslive.com/
About the Author
