Mexico’s Toluca Airport again hosts business aviation fair

 - March 29, 2007, 1:01 PM

“I’m very pleased this year,” Agustin Melgar, director of Aero ’04, told AIN. “Last year we had 37 vendors and this year we have 63. We’ve filled up our space completely, but most important is which vendors came. We’ve got the big companies like Gulfstream, Embraer, Cessna, Sikorsky and CAE SimuFlite.”

Melgar said several factors contributed to the success of this year’s show, which was held March 3 to 5 at the Toluca Airport in Mexico. “I think this proves that Mexico has nowhere to go but up. The economy hit bottom a couple of years ago, but with a new government, tax incentives favorable to aviation and the upcoming implementation of RVSM the aviation business climate in Mexico is definitely getting better,” he said. “I am seeing an influx of new aircraft coming into the country every month.”

One major vendor that has doggedly stuck by the annual show through good times and bad is Cahokia, Ill-based Midcoast Aviation. “We’re here every year, and this is a great show for us,” said Mike Coate, v-p of corporate aviation services. “We want to consistently show our support for Mexico and our interest in the operators here. We always make good contacts here, but even if we didn’t we’d still be here because it demonstrates our interest in the region. Mexico is a very important market for us.”

Coate said Midcoast gets a considerable amount of government and commercial business from Mexico. “It’s true that the economy has been depressed, but the reality is that aircraft have maintenance requirements,” he said. “Those that take care of their aircraft do so regularly, regardless of the economy; those that don’t take care of their aircraft aren’t affected by the economy anyway. Of course, there are a lot of good shops right here in Mexico that do routine maintenance, but there are some high-ticket items such as a $300,000 ComScan machine used for X-raying that folks down here might not want to invest in. So that is the kind of specialized service we can do.”

This year, because of the impending RVSM deadline, Midcoast offered RVSM informational sessions once a day for each of the three show days. “We explained our capabilities and then discussed the various RVSM solutions we offer on the Hawker 700, Sabre 65 and a number of other RVSM STCs we work with. We’re also very close to having the Sabre 80 solution as well,” Coate said.

Melgar explained that many Mexican operators have no idea RVSM is going to be required. “For some reason the word just hasn’t gotten out, but Mexico is tied to the U.S. when it comes to RVSM. It will be a requirement here next January 20, just like in the States,” he said. “The FAA also came down and gave a seminar about how RVSM will be implemented and what it means to the operator.” The RVSM seminars were offered free of charge, in addition to other informational sessions.

“We’re offering five different seminars free of charge,” Melgar noted. “Some are technical and some are operational. For example, CAE SimuFlite has a seminar on controlled flight into terrain. That’s a very good subject here because in Mexico we have a CFIT training requirement to renew your pilot certificate.”

“I like that they’ve mixed in the high-end cars,” said Bob Gibbs, Cessna’s propeller aircraft sales manager for Latin America and Africa. “I’ve been urging Melgar to do that for some time now because it brings a different clientele through the door. There is a lot of interest at Cessna in bringing new people into aviation. The cars attract people that are in a better financial situation and who like the excitement of high-end sports cars. It’s a good combination for entering into aviation.”

This year, for the first time, Melgar displayed several high-end sports cars, including a Jaguar, Lotus and two Volvos. The show is open to the public, free of charge.

By American standards, opening the show to the public is often considered more of a problem than it’s worth, but Gibbs put it in perspective. “I see the open access to the public as a good thing,” he said.“The Mexican general population is still growing accustomed to aviation. Opening this show to the public allows people to learn about the value of corporate aviation, and that’s a good thing. We take corporate aviation for granted in the U.S., but that’s not the case in many countries.”

Forging Relationships

Douglas Ray, president of Houston-based Global Aviation Services, agrees with the need to be at the show: “We’re a repair station specializing in Twin Commanders, Citations and Westwinds, but we are also a parts-supply house. We’ve been doing business down here in Toluca for 15 years. We have many relationships established down here, and many good friends. We’re here to get new business, of course, but also to stay in close contact with customers we already have. We see it as a good thing that the show is open to the public. A little kid who comes through here today could be a future pilot. In the U.S. that probably sounds naïve, but not so in Latin America. We see opening the show to the public as an educational tool because we’re trying to promote aviation as much as sell product.”

Ray explained that in Latin America business is as much about relationships as it is about products and services. “You can come down here and spend three years knocking on doors and never do anything. But you come down here and somebody local takes you around and introduces you to people, you’ll get in the door. Cold calling doesn’t work in Latin America–you have to establish and maintain relationships, so that’s what we’re doing. This is all about networking.”

“The problem we see in Mexico is sticker shock,” Gibbs explained. “The aviation community here has been fairly stagnant for quite a while. When someone comes to us to talk about a new aircraft, they compare their 20- to 30-year-old aircraft price and there is considerable sticker shock. Once someone gets a new aircraft, then their friends and people at the airport see it, they talk about it and it opens up more potential customers.”

Holt Dougherty, program manager for Tulsa, Okla.-based BizJet, agreed that the show is always productive. “We’ve participated in this show for the past 10 years or so and we’re making good contacts here,” he said. BizJet is an MRO facility specializing in corporate aircraft. “The whole Latin American market is really growing for us. It’s been fair over the years, but it’s been really growing lately. We’ve been getting a lot more inquiries in the past three to four months, but particularly in Mexico due to the age of the fleet. If you’re interested in corporate aviation in Mexico, this is the show to attend because it’s right here at Toluca.”

Melgar explained that Toluca is the center of business aviation in Mexico: “There are more than 370 corporate aircraft based here in Toluca. It’s the reason I chose to have the show here rather than anywhere else in Mexico. Last year we had 1,700 people attend, and it’s clear we’re going to hit 3,000 by the end of tomorrow [the last day of the show]. Things are going so well that we’re probably going to have to look for a new location on the airport. We’re 100-percent full this year and have turned away potential exhibitors.”

Embraer, too, views the Mexican market positively. The Brazilian manufacturer exhibited at the Mexican show for the first time. Guillermo Soto, one of Embraer’s marketing team members, said he considers Mexico a strong potential market for the Legacy. “Mexico is the second-largest market in Latin America next to Brazil,” he said.

“We see great opportunity here, especially with the Legacy. It’s the perfect replacement for JetStars, GIIs and Falcons. The thing is, Mexico is a very conservative market and most of the potential customers identify with such brand names as Learjet and Falcon. Brand name is very important here, so we need to work on establishing a presence. We believe it is important to understand the culture and needs of the market, so we have a Spanish-speaking representative here in Mexico City.”

Pedro Pirela, CAE SimuFlite’s Latin American regional sales manager, said this was the first year for his company at Aero Toluca. “I’ve already found new business here at the show,” he said. “There are a lot of new Hawkers in Mexico, and a lot of fleet upgrading is going on. Just by being here we’ve gotten a good idea of how to do business in Mexico. In fact, the corporate environment is definitely growing and we have already begun to invest in Latin America heavily.”

Pirela said CAE SimuFlite has an Airbus simulation center in São Paulo, Brazil, and it is looking at adding corporate aircraft simulators to that facility. “Brazil’s is the ninth-largest economy in the world, and there are currently more than 250 corporate aircraft based there,” he said.

Gibbs said there are about 300 Cessna Caravans in Latin America. “It’s a good market for us. We sell about a dozen Caravans a year to Latin American countries,” he said. “Latin America is alive and active, with each country having its individual challenges, but the Caravan is particularly well suited to the area. I always tell prospective buyers that anywhere you can drive a Land-Rover at 100 kph, we can land a Caravan.”

Mark Diaz, a pilot for EADS Socata who is based in Hollywood, Fla., would like to see his company get a piece of the turboprop-single market in Latin America. According to Diaz, the company currently has only one Socata TBM 700 operating in Latin America, and it’s in Chile. “I don’t think there’s any question about it. Single-engine turboprops are the future of Latin America, not only because of their fuel efficiency but because this is essentially a desert equivalent of Alaska,” he said.

“Just look at the elevation and terrain. You simply cannot fly efficiently and safely in this sort of environment with a four-cylinder piston airplane. The single-engine turboprop is the best choice. The infrastructure in many Latin American countries is very poor,” he said. “What makes more sense: driving five hours in a vehicle transporting cargo up and down mountains or flying it there in an hour? With a turboprop you can make that trip two or three times a day and a lot safer and faster while increasing the business opportunities.”

Enstrom Helicopter also exhibited at the show for the first time. Scott Parsinen, of the company’s sales and marketing department, said he’s been attending the show for years, long before he joined Enstrom. “I worked for a local FBO here on the airport from early 1995 until mid-1998,” he said. “I’ve gone to this show and the show in Acapulco every year.

I’ve seen this show grow over the years and become more efficient and effective. It’s much more professional today and much more vendor friendly. One of the things I really like about this show over the Acapulco show is that Acapulco is a vacation destination. In Acapulco, the show competes with the tourist attractions. This show serves a much greater purpose because it’s more focused. Also, we’re very close to Mexico City, making it easy to meet with important contacts.”

Parsinen said about a dozen Enstrom piston helicopters are used for military training in Peru, Colombia and Chile, in addition to some piston trainers in Venezuela and a turbine Enstrom used for electronic newsgathering in Mexico City. “We’re working on the biggest market–Brazil,” he said. “Robinson has grown enormously in Brazil, and Bell has a very strong presence there. We know we have to work hard to compete in that market, and we’re working wit

Elia Bedell, in charter sales for San Francisco-based TAG Aviation USA, said her company is just beginning to look at expanding into Latin America. “We’re a management company and do worldwide charter. Historically we’ve flown charters into Latin America but they have rarely originated there,” she said.

“But we see a lot of potential in the area and the economy is beginning to pick up. There’s so much potential growth because of all the international companies located in Latin America, particularly in Mexico. I walked around the airport this morning and it’s amazing how many N-registered aircraft you find on the ramps. We’ve definitely made some good contacts here already. Mexico specifically, and Latin America in general, are the future. It’s what’s happening.”