'INTERESTING CROSSROADS' Out West, an FBO remains upbeat about the prospects for GA

Jan. 8, 2003

By John F. Infanger, Editorial Director

SALT LAKE CITY — While some people fear what paranoia might wreak upon the aviation industry, William Haberstock, CEO of Million Air SLC and related companies, still believes in general aviation’s potential for society and the economy. He’s optimistic about the future for his $35 million, full-service aviation company, which today comprises two fixed base operations, aircraft charter and management, aircraft sales, and airline servicing. His prescription for success: full service.

" We’re at an interesting crossroads right now," says Haberstock, 55, regarding the heightened focus on all aviation activities following 9/11 and the potential for new security regs from the Transportation Security Administration.

"I don’t believe it’s going to do the industry any good to try and hide from TSA or Congress. It’s important that TSA and Congress understand how this end of the business works, how it fits into the national transportation system, and that they understand that these companies are complex. You can’t just shut down one end of the business and expect the rest to survive and grow.

Bill Haberstock,

"My own Congressman came to me and said that one good thing that’s come out of all this [increased focus on aviation activities], is that he had had no idea what our business was about and the extent of it, the impact." Haberstock, a native of the San Francisco Bay area, started learning to fly at this same SLC location, albeit for an FBO predecessor, during high school, and has been in the industry ever since, often as a corporate pilot. When he got into ownership of the business, he decided that a full-service aviation company was what could be successful in today’s market.

"The FBO is a portion of the fulls e rvice aviation company that we want to establish, so that anybody in the community that wants aviation services will be able to come here.

"A problem is that we fragmented this thing [general aviation], so much that the consumer got confused and therefore didn’t take action. I still believe that general aviation is an incredible industry for what it provides, and it’s not well known — yet."

Haberstock, who majored in journalism, thinks a critical element in future success has to do with industry getting its stories more widely told.

"I’ve flown air ambulance flights, transplant flights, high priority cargo. When that little girl in Midland, TX fell down the drilling hole, I got a call at two in the morning. There’s a company here in Salt Lake that makes high performance drill bits. An hour later, we got that drill bit here and put in on a Lear 25 to get it down there. She got out the next afternoon.

"There was a guy at a convention here one time who was the expert on rocket fuel, when a trailer full of rocket fuel blew up in Kansas City. He’s in Salt Lake City while the freeway is burning up in Kansas City. An hour and 45 minutes later we’ve got the guy on site in Kansas City because there was an air charter company here that could do it.

"With Thiokol based here, I’ve flown rocket motors or other components down to Titusville at two o’clock in the morning that allowed the shuttle to go off two or three days later. "The same story goes on all day long, every day in every city."

Regarding potential farreaching security rules, says Haberstock, "You can’t have a charter company exist, 24 hours a day, with pilots and everything else, if you begin to limit this side of the business and say you can’t go here or can’t go there.".

A REGIONAL PRESENCE In 1995, Haberstock was operating a small aircraft management firm at SLC when he, executive VP Leon Christensen, and another partner bought the Million Air FBO here. The umbrella parent company today is Keystone Aviation, with estimated annual sales at $35 million, according to Haberstock. The company operates a second FBO at Provo, home of Brigham Young University.
Keystone Aviation operates Million Air FBOs at Salt Lake City (above) and Provo, where it has a new FBO terminal. It recently broke ground on a 30,000-sq.ft. executive hanger at SLC, giving it 170,000 square feet of heated hanger space at the airport.

The charter division is Business Aviation Management, and the Intermountain Air division serves as the Piper distributor and Cessna parts center. Piper aircraft are sold through Arizona Piper, based at Sky Harbor International Airport in Phoenix, with service centers throughout its territory of Idaho, Utah, and parts of Wyoming and Nevada.

The company offers ground support and into-plane refueling services to commercial carriers JetBlue and Frontier, and cargo handling for Frontier, America West, and Continental. It has also ventured into GSE maintenance, which Haberstock says has potential for growth.

There are some 175 employees overall, 25 at the Provo fixed base operation that also features a five-air-craft flight training operation. The company added Provo in 1999, and recently completed a new executive terminal under a 30-year lease agreement. The company offers light aircraft maintenance at both FBOs.

The charter/aircraft management aspect of the business continues to grow, says Haberstock, without any one business sector being the predominant user.

"By being a full-service aviation company," explains Haberstock, "we’ve developed that business. When we bought it in 1995, there were no airplanes here. We’ve been approved by Wyvern and their audit; by Net Jets; both in our maintenance and our FBO. We’ve tried to run everything to be held out in their top tier.

" We don’t have any large parent organizations here. Our user base is all over the board; part of it’s Net Jets, part of it’s brokerage, part of it’s people based here or people visiting."

He credits having a wide array of executive aircraft available as a key reason for success with charter. The company has 14 turbine aircraft on its certificate, from Gulfstreams to Hawkers to a Pilatus PC-12. "People call us and we give them quick answers and then we perform ,so we get repeat business. "

"We never do seem to get to the 3-day work week"

What Million Air SLC employees do get to is higher productivity by way of an IT upgrade. That’s according to Ken Loder, the MIS manager for the two-location FBO, who has worked at bringing a system and a company on track with ongoing technology improvements.

It’s not like the fixed base operation was too far behind: It had a server with 70 computer workstations in place when Loder arrived in May, 2001 to become the company’s first full-time IT manager.

He recalls, "We have upgraded to four file servers and have basically replaced each of the 70 computers. What that did for us was to take us from the platform of an old Novell server and a smattering of operating systems, typically Windows 95 or 98, and graduated up to the Windows 2000 operating system on the servers, which is the replacement of the Windows NT server platform.

"With Windows 2000 in place, we now have a little more control with the security of users who can log in — authorized people who can connect to our network, our traveling pilots, and executives.3

"When I met these folks, their equipment was archaic, the network was slow and dangerously overloaded. It had very little security across the board, [from] virus protection to everybody having their passwords in bright letters on the wall."

Some of the cost estimates from Loder on the company’s computer system upgrade:

  • $600-700 per unit for some 50 new computers; others were rebuilt from parts and spares; average cost with monitor: $1,000;
  • 2 printers; $1,000 each;
  • 2 new file servers; $6,000 per unit;
  • "countless man hours."
The investment includes Loder and a half-time assistant. Having been an IT vendor himself, Loder appreciates what having a full-time IT staff brings to a small business. Loder, 37, was a special education teacher who got into computers in 1989 with Word Perfect in Orem, U T; the firm was purchased by Novell in 1993.

"We do more work now, faster and better with technology improvements in our lives, and yet its probably difficult to recognize because the more you can do, the more you do do. We never do seem to get to the 3- day work week. We work more and push that envelope on how much more we can do.

"In my dealings with other people in the industry, I find it’s quite a luxury to have a full-time IT guy. For this place, the first thing the FBO realized in hiring me is that I’m no longer an outside vendor; I don’t have to be called in to get something done. I’m less expensive as a salaried employee.

"Bill [Haberstock] and I can talk and we develop the system on an ongoing basis. A big advantage of an internal IT guy is being able to discuss the big picture."

Loder says an in-house training capability and program are another advantage. One server is dedicated to training and testing of new programs. "I want to try it, to use it before it goes live," says Loder.

He sees a need and an opportunity for more collaboration among IT personnel, with a goal of information sharing by FBOs and corporates. "It’s not that there are trade secrets to be had," he says. "There’s nothing harmful in supporting each other while not giving away the competitive edge."

Loder can be reached at (801) 933-7562 or [email protected].