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Greetings!
Leaving the Dark Side of the Moon was the title of an investment letter from a
major bank that I recently read. It
certainly has been a very dark economy for some time, but there seem to be some
sparks of brightness, not just in the economy, but in private aviation. This investment letter points out that "free
cash flow is piling up within corporations, and the Federal Reserve data
reflects a large increase in corporate liquid assets." Private jet bashing by Congress, the
Administration, and even the President seems to have abated. Recently the press reported that Homeland Security Secretary, Janet
Napolitano, said that one thing that makes her job easier is a plane. "I
haven't been at an airport as an airline passenger for about 15 months," she
said.
Some
believe that the charter industry data will be a leading indicator to the
private business aircraft recovery. ARGUS International, the highly
regarded data gathering/research company, reported for March that business
aircraft activity in March was up 12.9% over the previous month, but charter
declined slightly. (You can follow the
ARGUS business aircraft monthly data by clicking on this link to their TRAQPak data system.) As companies begin increasing their aircraft
non-charter (Part 91) activity they will begin using charter to provide the
required additional lift. Finally when
the recovery is solid and used inventory has been reduced, orders for new
aircraft will pick up. Remember there is
usually a several year lag between an order and the delivery of a business
aircraft.
"The Dark Side of the Moon" was the
title of Pink Floyd, an English rock band's, best selling album.
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A New Model for FBOs?
Out with the new in with the old
 After
traveling through this darkness all businesses are reviewing their business
model. My friend John Infanger in his
editorial in the February issue of Airport
Businessmagazine writes about how the FBO industry has changed since his
magazine was founded in 1986. Even the
magazine changed its name from FBO Magazine to Airport Business. John interviewed George Schuler, another old
friend, who has been in the FBO business for over 30 years. George thinks that there is going to be a big
fallout in the FBO industry in 2010 and 2011. Airports with multiple FBOs will have fewer,
and rural airports will find the municipalities back in the fueling business.
My FBO in
the 1980s was like most others - a conglomerate of several businesses, a full
service FBO as they were called.
Aircraft sales, a flight school, a maintenance shop, and charter
service, and, yes, we sold fuel and hangar space. Today a large percentage of FBOs only provide
the last two services. George is
starting up a new FBO at a new airport and is thinking of a new model - or
rather the old model. Stay tuned. |
There's a Trail for That
Our Government in Action
 The
Department of Transportation's mission is to "Serve the United States by ensuring a fast,
safe, efficient, accessible and convenient transportation system that meets our
vital national interests and enhances the quality of life of the American
people, today and into the future."
Under the DOT are the FAA, the Federal Highway Administration (FHWA),
the Federal Railroad Administration (FRA), the Federal Transit Administration
(FTA), and the Federal Maritime Administration (FMARAD). So
now maybe we will have under DOT: FAA, FHWA, FRA FTA, FMA, and be adding FBA (the
Federal Bicycle Administration) to that alphabet soup.
Recently
Transportation Secretary Ray LaHood who likes to ride his bike in Washington's Rock
Creek Park
on the weekends, has decided that the government is going to give bicycling the
same importance as automobiles in transportation
planning and the selection of projects for federal money. A manufacturers' blog called the policy
"nonsensical." One congressman
suggested LaHood was on drugs. Shall we have runways or bike trails? You decide.
You can vote now at Hangar
Talk or next November when it really counts.
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