February 2009
FUSELAGE SECTIONS JOINED FOR GULFSTREAM G250
(February 28, 2009)Gulfstream Aerospace, a wholly owned subsidiary of General Dynamics (NYSE:GD), recently celebrated the fuselage joining for the first Gulfstream G250, the company’s newest mid-cabin jet. The G250 forward, center and aft fuselage sections were joined utilizing the most advanced assembly process, which has proven to reduce the time needed to complete the fuselage. The improvement is the result of the G250’s cutting-edge design, which uses the most advanced engineering and design tools. “The fuselage joining is a tremendous step forward for the G250,” said Pres Henne, senior vice president, Programs, Engineering and Test, Gulfstream. “The mechanics have been very pleased with the precision of the assembly process. Everything went smoothly with the fuselage joining, and now we look forward to the next major milestone — the aircraft’s first flight.” The G250 offers the largest cabin and the longest range at the fastest speed in the industry’s mid-size class. The aircraft is capable of traveling 3,400 nautical miles at 0.80 Mach and has a maximum operating speed of 0.85 Mach. With an initial cruise altitude of 41,000 feet, the G250 can climb to a maximum altitude of 45,000 feet, where it can avoid congestion and adverse weather. The G250 is powered by twin Honeywell HTF7250G engines, each providing 7,445 pounds of thrust. The engines and nacelle package for the first flight test aircraft have already been delivered. Gulfstream projects the G250 to be certified in 2011 and expects to begin deliveries of the aircraft the same year. The first flight of the aircraft is scheduled for the second half of this year. Initial-phase manufacturing for the G250 takes place at Israel Aerospace Industries (IAI) headquarters near the Ben Gurion International Airport just outside of Tel Aviv, Israel. Gulfstream maintains an office at IAI to oversee production. “We are happy to take part in developing and manufacturing one of the world’s most advanced business jets,” said David Dagan, corporate vice president, IAI, and general manager, Commercial Aircraft Group. “This prestigious program is advancing as planned due to the hard work invested by the IAI and Gulfstream crews. We are proud of this achievement.” Final-phase manufacturing for the G250 will take place at the Gulfstream “Center of Excellence” completion facility for mid-cabin aircraft in Dallas. The G250 Program office is located in Savannah.
BBA Aviation to cut 350 jobs
(February 26, 2009)Britain-based BBA Aviation will cut 350 jobs this year due to the fall in demand for private jet travel. BBA, which provides services fro businesses and commercial jets, suffered a 20 percent decrease in demand for private jet travel in the last quarter of 2008. The company makes an estimated 80 percent of its revenue in North America, where private jet travel demand is consistently decreasing due to unfavorable economic conditions and negative public opinion. BBA spokespersons said that most of the job cuts will be made in the North America sector, which is no longer as strong as it used to be. According to BBA Chief Executive Simon Pryce, the company is not planning a full-recovery for 2009. However, Pryce asserted that BBA is well-placed to survive “volatile and tough conditions.”
Corporate Air Exec tired of negative image attached to private jet
(February 26, 2009)The recession has bought many ironies—household budgets shrink, cosmetic surgery sales up; need money for expenses, no means to acquire money; need jobs, no jobs; amongst others. One of them is CEOs appearing in the evening news—something that used to give companies good exposure. Nowadays, CEOs loathe being televised in the late news, especially if they were caught flying on corporate jets. These executives have to justify all their travel plans, whether it’s for business or pleasure. This has caused a downward spiral for private jet manufacturers, triggering controversies and arguments. Mike Vargo, Corporate Air’s director of marketing and sales, says it started from the “Big Three” mishap in Washington. He says, ever since then, public opinion has been persecuting CEOs who use private jets for business trips. “No one wants to be that guy on the nightly news,” says Vargo, whose company operates private charters at Allegheny County general aviation airport and manages corporate planes for its clientele. “I’m so frustrated about the images of the greedy CEO, smoking cigars and drinking champagne on his private jet.” Charter aviation, which is primarily composed of business travel, recreational travel, and medical flights, is down by 40 percent in the past year. Those statistics are based from the trade journal of Aviation International News. Vargo refused to disclose information on the status of Corporate Air. But he did mention that it is doing better than most.
Delta AirElite partners with Four Seasons Residence Club
(February 24, 2009)In a time when private jet companies need all the help they can get, Delta AirElite has signed a partnership with Four Seasons Residence Club Vail to target club owners, who are interested in experiencing Delta’s award-winning private jet service. On an exclusive basis, Delta AirElite is making its fleet membership jet card program available to potential buyers at the Four Seasons Residence Club Vail. The package markets the Club’s excellent service and hospitality, as well as the luxuries of air travel. “This thoughtful arrangement allows our owners and prospective owners to begin the pleasure of their vacation before arriving at Four Seasons Residence Club Vail,” said Jeff Meier, senior director of sales and marketing, Four Seasons Residence Club Vail. “The convenience of private jet access creates an experience ideal for our discerning buyers during frequent travel to Vail, direct to the Vail Valley Jet Center. The opportunity offers a luxurious experience and flexibility – both important factors for our owners.” Delta AirElite president and CEO Mike Green commented, “This new relationship is a natural fit for Delta AirElite and the selective individuals who enjoy the Four Seasons quality of life.” He continued, “Through this cooperation between two world-class brands, Four Seasons owners and potential buyers can experience firsthand the high value our Fleet Membership jet card program affords, as well as the comfort and convenience of our award-winning service.” The two companies hope that their combination will be a winning formula that will bring benefits to both sides.
Jet Advisors featured in Investment News
(February 23, 2009)Jet Advisors, a company that manages private jets, was recently featured in InvestmentNews Report. The company was represented by its president—Kevin O’Leary, who talked about the current status of private aviation. InvestmentNews anchor Mark Bruno arranged an interview with O’Leary to discuss the negative public opinion that has hampered the private jet, as of late. O’Leary acknowledged the slump, but he spoke of a “silver lining”. O’Leary said that things are picking up and that the market will soon stabilize. A recovery will trigger a good buying environment, stated O’Leary. Plus, he stressed, financing is becoming a more viable option for potential buyers. “There are so few buyers out there at the moment, yet the number of sellers is growing constantly,” O’Leary wrote in an article to titled Banks bail out of jets. “If you want to move something right now, you have to lower your asking price to a number where a buyer just can’t say no.” The Jet Advisors president topped off the interview with a compelling statistic—there has been a rapid increase of private jets for sale, from 4-5 last year to 30 this year. And these jets are priced for up to 40% less than its original price.
EAD Aerospace offers interior upgrades for private jets
(February 23, 2009)EAD Aerospace, a company that specializes in avionics modifications, has announced a new offering for private jets in the Middle East Market. The Toulouse-based company is now offering new interior design concepts for private planes to provide passengers added comfort and luxury. EAD Developers have come up with new ways to add art and function inside a private jet. Designs range from paintings and sculpture to furniture. All of these can be enjoyed by air borne passengers. The new designs have carefully observed air traffic rules and regulations. EAD Aerospace co-founder Stéphane Bloch stated, “I believe that there isn’t a period in history, from antiquity to contemporary creation, where the Arab World hasn’t been a source of inspiration and fascination for the European artistic milieu. Therefore, we are delighted to lend our aeronautic skills to those with refined taste and style.”
Private Jet fights against Bad Perception
(February 20, 2009)This mishap all began when the big three automakers flew into Washington via private jets. The ironic thing is, they came to the nation’s capital to ask for a rescue package from the government. Now, private jets are dealing with bad perception and an even worse economy. “Our industry as a whole is down between 30 and 50-percent,” said Ira Eichenfield of Corporate Flight International. Eichenfield says that many corporations, who didn’t get bailout money, use these jets to conduct business—it’s more efficient. “If you do three or four stops a day in different airports in different states, not only is it going to save you a lot of time, but it can actually save you money on those airline tickets because you couldn’t do that in a day” said Eichenfield. And in the world of business, time us money. But, these private jet companies don’t only fly corporations; they also fly celebrities and families. To those who can afford it, flying via private jet is sometimes cheaper than buying separate tickets on commercial airlines. Eichenfield highlighted that these jets can land in many areas where commercial airplanes can’t. He says it all comes down to the perception of the public and the politicians. “It will continue that way until they realize they themselves travel in these types of airplanes and how productive and secure it is. They use them all the time. It’s kind of like a double standard—almost hypocritical.” Source: LasVegasNow
JetBlue targets corporate execs
(February 19, 2009)Numerous CEOs and corporate execs have recently gone under fire from using private jets to conduct company business and travel. As a result, most companies are suspending their private jet privileges. Enter: JetBlue Airways. JetBlue Airways, an air travel charter company, has developed a new campaign that is targeted at corporate execs that have recently lost their travel privileges. The company recently posted an ad on its Website, saying, “We understand it’s not easy being a high flyer these days. The CFO is picking apart your expense reports. Congress is mad about your bonus. And you can’t even hop on a private jet to the Cayman Islands without freaking out the shareholders.” The ad continues, “But even this economic cloud has a silver lining… actually more of a bluish lining. Because now you get to try JetBlue.” JetBlue offers customers a luxurious jet with gracious cabin space, satellite news sources, unlimited food and beverage, and direct routes to Bermuda, Aruba, St. Maarten, as well as New York and Boston. Reports have confirmed that the campaign will have appearances in the New York Times and the Wall Street Journal, this week. Next week, the campaign will be advertised on radio stations.
JetSuite delivers Phenom 100 to US client
(February 19, 2009)JetSuite, a private jet charter company, has announced the successful inspection, export, import, and delivery of its first client Embraer Phenom 100. The company has 100 additional Phenom 100 light jets on order. Some of those planes will be available for corporations and private parties who enter into contracts and agreements with JetSuite. The production and delivery inspections were conducted in Sao Jose dos Campos, Brazil, making it the first Phenom delivery to be based in the West coast of the US. The company worked closely with the client to organize the turnover from Embraer. The Phenom 100 is the industry’s best cabin value private jet. According to the JetSuite press release, “it [Phenom 100] will efficiently accommodate the majority of trips flown in the U.S.” “In an age where corporate aviation needs to justify itself to shareholders and taxpayers alike,” conditioned Alex Wilcox, CEO of JetSuite, “the focus on value has never been higher and the Phenom 100 reduces the cost of most missions by 70 percent or more, depending on the jet it is replacing. This extremely efficient and comfortable jet is arriving on the market at just the right time.” JetSuite plans to launch charter operations from Los Angeles, San Francisco, and Las Vegas starting with a fleet of seven jets for the year. The company will be adding two jets per month to widen service in the Western region of the US, Alaska, as well as Canada and Mexico. “We’re excited to provide the first private party Phenom delivery to the U.S.,” said Brian Coulter, VP Flight Operations for JetSuite. “Working together with our suppliers and the multitude of export, transit and import authorities, our team delivered our customer’s jet from Brazil to the U.S. in just over 54 hours, without a hitch.”
Stimulus tax break promotes private jet sales
(February 18, 2009)Just a few months after lawmakers scolded auto executives for flying to Washington in private jets, Congress approved a tax break in the stimulus package to help businesses buy their own planes. The incentive — first used to help plane makers recover from the 2001 terror attacks — sharply reduces the upfront tax bill for companies who buy assets such as business planes. The aviation industry, which is cutting jobs as it suffers from declining shipments and canceled orders, hopes the tax break in the economic-stimulus bill just signed by President Barack Obama will persuade more companies to buy planes and snap a slump in general aviation that began last year. "This is exactly the type of financial incentive that should be included in a stimulus bill," said Rep. Todd Tiahrt, R-Kan. in an interview. His state lost at least 6,900 jobs at Cessna and Hawker Beechcraft, both based in Wichita. Roughly 11,000 jobs have been cut in the last three months by the 65 or so member companies of the General Aviation Manufacturers Association, an industry trade group. The industry needs a stronger economy, not a tax break, to recover, according to aviation consultant Richard Aboulafia with the Teal Group in Fairfax, Va. "People and companies buy jets when they need new planes and feel good about the economy," he said. "If they don’t feel good about things, a tax break isn’t going to help." Officials from industry trade groups disagree, saying a tax break will spur purchases, and give sales teams another tool to keep customers from canceling orders. Many economists believe the current recession will last until at least the end of this year and may extend into 2010. "It’s trying to give you a reason to act now, rather than sit on the sidelines for the next two years," said CEO Ed Bolen of the National Business Aviation Association, a trade group that represents general aviation interests of 8,000 companies. The incentive — known as accelerated depreciation — lets companies take a larger deduction in the early years of the life of an asset such as a plane. Companies will have to place orders by the end of 2009, and those planes will need to be delivered by the end of 2010 to take advantage of the tax benefit. First used in the months following 9/11, an industry study found accelerated depreciation helped boost sales by 43 percent, and later contributed an additional $2 billion in sales when implemented again in 2003. Even with its previous success, both industry officials and lawmakers concede the incentive is by no means a cure-all during one of the worst recessions seen in decades. "It’s not a silver bullet as a stand-alone effort," said Tiahrt. "(But) this will certainly be helpful. This will sell aircraft that we wouldn’t have sold before." The industry was able to convince lawmakers to remove a provision in an early draft of the stimulus bill that would have prohibited banks that receive bailout money from buying or leasing private aircraft. The provision grew out of scorn for leaders of General Motors, Ford and Chrysler, who flew to Washington on private jets in November to ask Congress for $25 billion in taxpayer money. Two of the largest makers of general-aviation aircraft — Cessna, a unit of Providence, R.I.-based Textron and Hawker Beechcraft — have also launched advertising campaigns to tell business executives to ignore criticism and keep buying planes. It’s too soon to know whether those appeals to corporate ego will work. For now, the main response of many general-aviation companies has been to cut jobs, hunker down and hope the recession doesn’t drag on. Teal Group’s Aboulafia said companies must cut costs while continuing to push ahead with development of new planes and parts that will drive growth once the economy rebounds. Cessna spokesman Doug Oliver, who said the company reduced its 2009 delivery forecast for jets to 375 from 535, thinks the tax break will help. "It is a big deal," he said, adding that it helped pull the industry out of the post-9/11 slump that lasted into 2003. Oliver said cutting prices is not the answer for private-plane manufacturers. "Planemakers don’t like to discount pricing because it cheapens the value of planes they already sold," he said. "You are not going to see deep discounting on business jets, but we still negotiate with customers." Piper Aircraft Inc. just cut 300 jobs but is pushing ahead with plans to unveil a $2.2 million jet model by the end of 2011. Mark Miller, a spokesman for Piper, said orders for the jet have held at more than 200, while cancelations spiked in the last two weeks of January for its current lineup of prop planes. Vero Beach, Fla.-based Piper, whose planes start around $200,000, recently cut its forecast for 2009 deliveries to 110 from 135. That was down further from a September projection of 236 deliveries. Miller said the accelerated depreciation of aircraft "is promising," but sales would be helped more if banks lend more for aircraft purchases. Some experts say banks that previously demanded only 5 or 10 percent down on a plane now insist on 20 to 30 percent. "Our customers are small business owners and professionals like lawyers," Miller said. "They’re recession-resistant, but they’re not recession-proof."
