Corporate Jets Aren't Just For Fat Cats
October 23, 2009
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  • ‘No Plane, No Gain.’ That’s the motto adapted by the sector of the aviation industry hit hard over the last year in the wake of the economic collapse and the public perception of corporate aviation. A new study out this month shows the use of business jets and other small aircraft is more about companies trying to gain efficiency and improve the bottom line, rather than provide luxurious transportation to a few at the top of the corporate ladder. The industry’s effort is to try and dispel many of the misconceptions public holds towards the use of general aviation aircraft by companies around the country.

    While the extravagant use of private jets by individuals heading off to exotic locales tend to make the headlines, the reality for the vast majority of corporate aircraft is very different according to the survey of passengers and flight crews. The study [pdf] was prepared by Harris Interactive for the National Business Aviation Association and the General Aviation Manufacturing Association ahead of this week’s NBAA annual meeting being held in Orlando, Florida.

    In the study, only 22 percent of passengers on business aircraft were top level executives, while 70 percent of passengers included mid level managers, sales, technical and service staff. The average number of employees per company who flew on business aircraft during a six month period before the survey was 85.

    In addition to aircraft usage, another key point highlighted in the report follows the old real estate motto of location, location, location. Almost half of the flights made by business aircraft in the survey are to airports with little or no scheduled airline service and a third were to smaller, secondary airports.

    Of the more than 5,000 airports available for public use around the country, only about 600 have any kind of scheduled service and most airlines fly in and out of the 70 major hub airports. The ability to utilize more of the airports not served by airlines not only serves the companies trying to save time by flying closer to their destinations, it also reduces the traffic in and out of the hub airports, reducing delays for the airlines.

    While these kinds of numbers may support the industry’s claim that business aviation is a tool used by companies trying to make money, not waste it, public perception has been hard to sway. It’s been almost a year since corporate aviation took a giant hit between the eyes of public perception after CEOs from the big three automakers flew company jets to Washington D.C. to ask for financial help from the government. Since that time several corporate flight departments and the industry have been hit hard after the public outcry.

    But the uproar is misplaced says aviation consultant Peter V. Agur, Jr in an editorial over at Agur writes that for many businesses, it makes no more sense for employees to travel by airline than it does for a fireman to travel by city bus. Both examples may appear to be cheaper in the short term, but in the long term they are less likely to achieve their goals.

    As for the often mentioned high costs of corporate jets, Agur says in these lean times, companies are not going to waste money on anything that isn’t adding to the bottom line. He points out business aircraft use is a tiny fraction of the budget for most of the companies that use them, adding cars make up a much larger percentage of most people’s personal budgets.

    Whether or not public perception will be shifted on the topic of business aviation remains to be seen. But the industry, like the economy, is starting to show signs of recovery. The number of aircraft on the used market is dropping, and companies at this week’s NBAA meeting are seeing some trickles of light at the end of the very long tunnel. Though after plane makers like Cessna slashed half its workforce, the road flight to recovery is likely to be a long one.

    Source: WIRED NEWS
    Date: 2009-10-21