Gaining Altitude Across the Globe: Exciting Times for Business Aviation
by Rita E. Garwood November/December 2018
Deliveries of new aircraft are up, new airframes with exciting capabilities are reshaping the market and business aviation operations are on the rise in nearly every market across the globe. In a Q&A with Monitor, Ed Bolen discusses trends that have shaped the industry this year.
Ed Bolen, President and CEO, National Business Aviation Association
According to GAMA’s Q2/18 aircraft shipments reports, global aircraft shipments were up while billings were down. What factors have influenced the economic state of the industry?
The small- and midsize-turbine segments, along with piston-engine aircraft and turboprops, were among those hardest hit in the aftermath of the 2008-2009 global economic recession. At the same time, the Asia-Pacific region emerged as the next major business aviation marketplace, and those buyers tended to favor large-cabin, intercontinental aircraft that also carried higher price tags.
Large-cabin jets remain popular today to buyers around the world, but as the industry’s economic strength has rebounded we’ve also seen an uptick in deliveries of smaller aircraft to new buyers, and existing 2018operators choosing more specialized and economical aircraft tailored to their specific needs and missions. With this rebound has also come the introduction of new aircraft in these segments, including initial deliveries for some types. Billings are lower for those smaller aircraft, of course, but more aircraft are entering the market overall and that’s an exciting trend to see.
What is your outlook for the business aviation industry next year?
NBAA tends to avoid making predictions about the future, but I will say it’s encouraging that our industry not only continues to grow within existing and established segments, but that we’re also seeing the potential for an evolution in the kinds of missions defined under the term “business aviation.”
For example, this year’s NBAA Business Aviation Convention & Exhibition (NBAA-BACE) included discussions about emerging technologies such as autonomous air taxis and electric vertical takeoff-and-landing (eVTOL) aircraft, and of course unmanned aircraft systems (UAS). It will be exciting to see what developments come in these areas as the overall business aviation industry continues along a path of steady growth.
According to a report from AINOnline, at the NBAA regional forum, you “noted that the call for [air traffic control] privatization was devoid of benefits such as competition, innovation, and free enterprise, and NBAA ‘recognized the inherent threat and called on our community to respond in ways they’ve never responded before.’” Can you share more of your thoughts on this important issue with our readers?
NBAA believes privatization represents an existential threat to access to airports and airspace in the air traffic control (ATC) system, because privatization would hand control over an entity that now exists to serve the public interest, to an unelected board, not accountable to congressional oversight, and — at least in the so-called privatization proposals we’ve seen so far — dominated by the big airlines. While the current threat may have passed with the signing of FAA reauthorization legislation without any mention of privatization, we know this matter is not going to go away quietly.
Our most recent victory on this issue came as a direct result of the tens of thousands of letters, phone calls and meetings logged with members of Congress — in Washington, and in lawmaker’s home states and congressional districts — to express steadfast opposition to ATC privatization. It was a historic mobilization of our membership and our industry.
What other agenda items are top of mind for NBAA members, and how do these items affect the vitality of business aviation industry?
One concern repeatedly raised as I’ve spoken with our members at a variety of events around the country over the past year is the critical need to address existing workforce shortages in our industry, while also developing the next generation of business aviation professionals. NBAA has taken a multifaceted approach to this issue, including through such programs as the annual Careers in Business Aviation Day at NBAA-BACE, which introduces students to the wide variety of potential careers within our industry.
NBAA also provides numerous resources for our members to use in developing mentoring and internship programs within their flight departments, as well as scholarships, professional development initiatives and a wide range of educational opportunities for new and existing business aviation personnel. There’s still more to do in this area, and we are constantly examining how NBAA may best support all efforts to attract and retain future generations of business aviation professionals. In short, our industry depends on it.
If there was a “most important” program or project that is currently under consideration by regulators in the aviation industry, what would it be and why?
The continued effort to modernize our national airspace system must be among the top priorities for all U.S. aviation stakeholders. NBAA has worked for many years to promote technologies, policies and procedures that ensure America’s aviation system remains the largest, best, safest and most diverse system in the world, and that includes support for the FAA’s ongoing rollout of next-generation, or “NextGen” technologies, many of which have already been successfully implemented.
That said, our industry must also do its part to support these efforts, and work within that modernized airspace network. At the forefront of that obligation is the need to equip business aviation aircraft with automatic dependent surveillance-broadcast (ADS-B) technology before time expires on the Federal Aviation Administration’s January 1, 2020 hard deadline. Operators that haven’t yet equipped with ADS-B, or defined their path for equipage ahead of the deadline, will likely face a significant challenge against the realities of available shop space and maintenance personnel.
Over the next five years, what would you like to see happen that would cause you to feel better about the future growth of the business aviation industry and why?
Historically, public perception about business aviation has been an ongoing concern. Business aviation is a vital industry within the U.S. and around the globe — it’s an industry that supports more than a million jobs and over $200 billion in economic activity, it helps companies of all sizes compete and succeed, it connects towns and communities with little or no airline service, and it provides air support for worthwhile humanitarian endeavors.
We’ve made tremendous progress in making these numerous benefits understood by policymakers and opinion leaders, especially through the No Plane No Gain advocacy campaign, co-sponsored by NBAA and the General Aviation Manufacturers Association (GAMA) — but there’s more to be done in ensuring decision-makers understand the value of business aviation to citizens, companies and communities across the U.S.
Is there anything else about the business aviation industry that you would like to share or comment on for our readers?
Overall, I believe this is a very exciting time for our industry. Deliveries of new aircraft are up, new airframes with exciting capabilities are reshaping the market, and business aviation operations are on the rise in nearly every market across the globe. At the same time, we may also reflect upon a milestone year that demonstrated the importance of engagement throughout our aviation community on matters affecting us — and, as we’ve seen through the debate over ATC privatization, that voice resonates stronger and more clearly now than ever before. While there are many challenges that will continue to influence our industry in the years to come, I am confident that business aviation stakeholders are well-prepared to confront them.
Barry Shafran, President and CEO , Chesswood Group Limited
Barry Shafran shares the story behind Chesswood Group’s journey from a Canadian new car dealership business with automotive lease receivables of just $80 million in 1999, to a North American public equipment finance business with a portfolio of $1.0 billion in 2019. He says the one constant and key ingredient in Chesswood’s journey is its amazing team of tenured and committed people.
Whether you are a third-party originator or a funding source/bank, the responsibility lies with all parties to build partnerships based on mutual trust, mutual commitment, shared ideas and common goals.