EBACE 2005

 - October 16, 2006, 5:23 AM

Averitable order bonanza totaling an estimated $420 million, a new attendance record (7,667) and some industry surprises were the highlights of the fifth annual European Business Aviation Convention & Exhibition, held May 18 to 20 in Geneva. But the decidedly upbeat event lacked announcements of clean-sheet, new aircraft designs.

Accounting for almost half of the order value (based on estimated basic prices), Airbus announced sales of four $50 million ACJs: one to India’s UB Group; another to Kharafi Group of Kuwait, which was the first customer for the type; and two for Saudi Arabian VIP/charter specialist National Air Services, which expects to order a third by year-end.

Bombardier secured an order for a Learjet 40 ($12 million) from California-based Air Max, the charter operator’s second. The deal followed the sale of a Special Edition Learjet 60 ($12 million) and a Challenger 604 ($24 million) to Madrid-based Onde 2000.

Pilatus Aero sold three PC-12s, which typically have a price tag of about $3.2 million a copy: two to Luxembourg-based fractional operator JetFly and the third, the aircraft on display at EBACE, to an unnamed Portuguese operator.

Gulfstream recorded an order from NetJets Europe for two more $40 million G550s after the fractional operator had sold all the shares in its first. The Savannah, Ga.-based OEM also secured a letter of intent for three G350s ($27.5 million each) from National Air Services of Jeddah, which already operates three of the type.

The count of 7,667 registered attendees at EBACE 2005 translates to an 18.2-percent increase over last year’s three-day total of 6,487. Attendance has more than doubled since the first EBACE in 2001, when 3,620 visitors turned out for the event. In addition, a record 278 exhibitors increased the exhibits on display by more than 20 percent, and 51 business aircraft were on static display at Geneva International Airport, a more than 40-percent increase over last year.

These positive numbers notwithstanding, the major aircraft manufacturers chose to announce (in addition to sales) only new derivative models or to highlight airplanes currently under development. Bombardier launched a family of corporate/executive shuttles, dubbed the Challenger 850, 870 and 890, which have specs that are similar to those of the CRJ200, -700 and -900; Raytheon Aircraft trumpeted upgraded versions of its Hawker 800XP and Premier I; Gulfstream talked about its developing G150; Dassault hailed its now flying Falcon 7X; and Cessna crowed about its $6 billion backlog. Eurocopter and Agusta, the only helicopter manufacturers showing aircraft, made no announcements.

Executive Airbus A380

Perhaps the biggest surprise was not about an aircraft design but rather an interior. Airbus and Lufthansa Technik (LHT) executives unveiled a cutaway model of an Airbus A380 to show a concept for VIP cabin completion and said the first private A380 could be in service in as little as five years. Richard Gaona, Airbus vice president for executive and private aviation, said production of the A380 is currently sold out through 2011. But potential customers–and it seems there is no shortage–he said, would not be willing to wait that long, “So I will be pushing for one or two additional airframes to be made available in 2008 to 2009,” he said.

Bernhard Conrad, LHT senior vice president for completion center sales and marketing and head of approved design organization, said the airplane is the equivalent of two widebody cabins, one on top of the other, so the first completion of a green aircraft could take two years. But a lot of work is already going into shortening that downtime for subsequent completions.

“We are already discussing several VIP applications for flying palaces based on the A380, and Lufthansa Technik has the skills and competence to make it,” Gaona said. “Look at how many VIP Boeing 747SPs there are and you will see the size of the market.” The two men even met one prospective client in Geneva during EBACE to discuss a plan that would involve selling time in individual cabins for the flying equivalent of a cruise ship, he added.

The airplane’s 6,460 sq ft of cabin floor area provides many more opportunities than a traditional aircraft. The design shown in the model is just one of many the company has developed as part of its preparatory work. Said Conrad, “For example, you could have an aisle with rooms on both sides. And you could have dedicated rooms such as a movie theatre or a real gymnasium with work-out machines that don’t have to be folded away under beds or seats.”

At the EBACE 2005 opening general session, Daniel Calleja Crespo, director of air transport at the European Commission (EC), outlined the new strategy of the European Union (EU) toward air transport. “We do not want to over-regulate the air transport industry. We want to find more effective solutions to ensure the competitiveness of the sector and provide better infrastructure,” he said. Making use of business aviation himself, Crespo had traveled to Geneva on board a Learjet 45 hired by the European Business Aviation Association (EBAA) to allow the senior EC official to return for an important meeting in Brussels that afternoon.

Four Priorities for European Air Transport

Crespo outlined the EC’s four main priorities for air transport. The first is the consolidation of the internal market with further market liberalization beyond ground-handling services, while securing fair competition. The second involves safety, security and the environment. The European Aviation Safety Agency (EASA) should be given enlarged powers, he said, to regulate air operations and crew licensing, for which a legislative proposal will be presented this year.

Also, the EC wants to ensure that air transport is environmentally sustainable. The commission plans to issue a communication on climate change next month that will promote the idea of an emissions-trading program for air transport.

Third, the EC wants to extend the EU aviation rules through agreements with other countries. “We want a more integrated approach. Bilateral agreements are no longer acceptable,” stated Crespo. The EC is already in negotiations with the Balkan states, Morocco, China and Russia to obtain greater market access while extending the area of application of EU regulations. Talks with the U.S. authorities about an open aviation area are also in progress.

Finally, the fourth priority is infrastructure, the main challenge to growth, with airport capacity being insufficient to cope with the increase in traffic demand forecast through 2025. “About 75 percent of the 133 top European airports cannot build new runways in the next 20 years,” Crespo said.

Brian Humphries, EBAA chief executive and co-chairman of the joint EBAA/ NBAA Industry Working Group on Business Aircraft Operations, said in a special session on the topic that the aim of the group is to develop a set of recommendations to harmonize rules for private and on-demand charter operations within Europe and between the U.S. and EU. There is an urgent need for such recommendations because no regulatory framework for fractional operations in Europe now exists and European states view fractional operations as more similar to commercial than to private operations.

Fractional Compromise

In the interim, European authorities may be ready to accept the operation of U.S. fractionals under private rules (FAR Part 91 Subpart K), without requiring a commercial license to operate within Europe. However, an ECAC official insisted that approval of this compromise would depend on finding a satisfactory solution to the lack of security oversight by the U.S. government.

ECAC states would also consider favorably a decision by U.S. authorities to reduce the administrative burden put on European charter operators seeking to obtain a permit to conduct occasional flights into the U.S. These flights are currently restricted to six per year, whereas there is no such restriction on U.S. charter flights in Europe.

NBAA Wants Grass-roots Effort against User Fees

NBAA president and CEO Ed Bolen, at his first EBACE as leader of the association, rallied business aviation’s grass roots to counter the threat of user fees. The airlines have a common agenda, he said, and that is to reduce the taxes they pay into the Airport and Airway Trust Fund.

NBAA counters that the fuel tax business aviation now pays is the most logical, efficient, progressive and environmentally friendly.

Bolen said a grass-roots effort needs to generate tens of thousands letters and e-mails to Capitol Hill. To facilitate this, NBAA has added to its Web site (www. nbaa.org) a “Contact Congress” function that helps users quickly contact their federal representatives by e-mail.