Jet Aviation Singapore feels effect of economic recovery
The warm breeze drifting across Singapore Seletar Airport brings a welcome respite from the midday heat in this island nation near the earth’s equator. At Jet Aviation Singapore, v-p and general manager Geoffrey Hopkins is anticipating a breeze of a different kind–a wind of economic recovery brought on by growing prosperity in the Asia-Pacific region.
After opening its doors in 1995, the FBO enjoyed an encouraging first couple of years. Singapore is ideally located as a service center for business aviation in the surrounding region, as far north as Hong Kong and south to Australia, and the Singapore government had offered attractive incentives. And while Seletar Airport is VFR only, with a rather short 5,500-foot runway, the weather year-round is such that instrument approach aids are rarely needed.
Unfortunately, the Asian economic implosion in the late 1990s rolled back the growing success of Jet Aviation. “Some 70- to 75-percent of the market disappeared within about six months,” recalled Hopkins, who had started as director of maintenance when the facility was opened. “It’s been about five years, and even now [that business has] only 80- to 85-percent recovered.”
While Singapore may be ideally located for the purposes of business aviation travel, as well as aircraft maintenance and service, it is equally well placed as a commercial air center. Major airline service at nearby Changi International Airport is frequent and efficient, doing little to encourage travel there by business aircraft.
Nor has it been particularly encouraging to hear, year after year, talk of closing Seletar Airport. So far, said Hopkins, “it has been only talk, and more recently there was some hope of seeing the runway extended 500 feet to accommodate operations by a startup regional carrier.” Unfortunately, that carrier was lured away by incentives offered by Changi International. As a result, the runway extension appears to be on hold.
And noise remains something of an issue. Both Changi and Seletar will be affected by Stage 3 noise restrictions that go into effect this month. However, Hopkins explained, waivers will be granted for aircraft having maintenance done at Seletar.
On the day of AIN’s visit to the facility during the Asian Aerospace show in Singapore in late February, business did not appear to be booming at Jet Aviation. There was a Challenger 604 in the maintenance hangar, along with a Hong Kong-based Global Express and a China-registered Learjet 36A. On the ramp, a Learjet and a King Air sat baking in the sun. The resident business aircraft list was short–a single Global Express managed, maintained and operated by Jet Aviation.
Fuel Sales Aren’t Paying the Bills
Unlike the typical U.S. FBO, Jet Aviation Singapore is not making the bulk of its income from fuel sales. Fully 85 percent of Jet Aviation’s revenue comes from its maintenance activities, and the remaining 15 percent or so from the FBO’s ground-handling operation. The problem is that Jet Aviation’s fuel comes from a Seletar competitor. Priced at almost $2 a gallon, it is about double the cost of jet-A at Changi International. As a result, said Hopkins, Jet Aviation makes “virtually nothing” on fuel sales.
And the threat of terrorism has not made the process of doing business at Jet Aviation Singapore any easier. Concern for safety by the airport authorities resulted in the installation of a heavy fence, topped with barbed wire, between the Jet Aviation facility and its parking ramp. As a result, transient crews are allowed through the fence only twice–once on arrival and again on departure. Approval for passage through the fence by other than previously approved personnel can otherwise take as much as 24 hours.
But Hopkins is not discouraged by the challenges facing Jet Aviation Singapore. Far from it. He pointed out that a new resident airplane was added at the end of February–a Gulfstream IV from the ShareJet charter service of Macau. The only other charter Gulfstream available in the Asia-Pacific rim, said Hopkins, is based in Australia. ShareJet is sufficiently convinced of the demand potential for its regional operation and its Singapore-based Gulfstream that it has also opened a sales office in Singapore.
Hopkins pointed out that Jet Aviation Singapore is much more than just an FBO terminal. The facility is an authorized service facility for Bombardier, Gulfstream and Cessna. If growth in service and maintenance hasn’t been spectacular, it has been steady, and Hopkins expects to see this improve in the near future. “With new deliveries of Gulfstream IVs, Gulfstream 550s and Global Express to the Asian market in 2004, we expect considerable growth in our maintenance activities for this year.”
Unrealized Potential of Asia-Pacific Bizav
The description of business aviation in the Asia-Pacific region for at least the last decade has inevitably been prefaced by the phrase “unrealized potential.” In the last decade, in fact, the number of business aircraft registered in the Asia-Pacific region has grown by only 26 percent. Nevertheless, manufacturers such as Bombardier are convinced that this potential eventually will be realized, and in the not-too-distant future.
At Asian Aerospace 2004 in February, the Canadian-based company’s Flexjet Asia-Pacific announced a merger with its Flexjet Europe sister company to create a “seamless” Flexjet International block-charter program. According to the new company’s managing director, Judith Moreton, before year-end two new Learjet 60s will be added to the Flexjet International system by a Sydney, Australia-based operator, and Flexjet China affiliate Global Wing will take possession of a new Learjet 45XR.
Hopkins is also encouraged by news that NBAA recently announced plans for a new Asian Business Aviation Conference & Exhibition (ABACE). The initial show (more a forum) is scheduled for Hong Kong this July 14 to 16, to be followed next summer by a full-blown conference and exhibition in Shanghai.
All this bodes well for Jet Aviation’s managed fleet in Asia, which recently added eight more aircraft, including the Singapore-based Global Express.
“In the Far East we have recently received several requests for quotes to manage aircraft, and the outlook for the next few months appears promising,” said Jurg Reuthinger, senior v-p and general manager of Jet Aviation’s aircraft management division for Europe, the Middle East and Far East. Jet Aviation, he said, has enjoyed an increase in charter activities in the region of as much as 10 percent.
Jet Aviation Singapore has also expanded its outstation support capability to Far East customers with services available 24/7, including aircraft-on-ground services, unscheduled repairs and defect rectifications, routine maintenance, modifications and even refurbishment.
“Our dedicated factory-trained AOG team has developed a growing reputation throughout Asia on a variety of business aircraft,” said Hopkins. And he noted this reputation is not limited to aircraft for which Jet Aviation is an authorized service center. They have also been called out for work on King Airs and Hawkers.
One recent request required an avionics technician to fly to India to perform RVSM checks on a Gulfstream IV. That job included calibration tests of the air data computers. Another job called for interior refurbishment of a Challenger 604 that took Jet Aviation Singapore interior specialists to the customer’s China site to install new carpet and make minor interior repairs.
Parent company Jet Aviation also recently signed new agreements with Williams-Rolls to support the FJ44 turbofan engine at four locations worldwide, including the Singapore site. This means the establishment of tooling, test equipment, training and maintenance of a substantial parts supply in support of the engine series. The FJ44 currently powers more than 600 Cessna Citation CJ1/CJ2s and Beech Premier Is.
“In short,” said Hopkins, “Jet Aviation Singapore remains ideally positioned to provide maintenance, avionics and engine support to a broad range of business aircraft operating in this region. And it offers an economically and politically stable base of operations for the foreseeable future.”
Hopkins pointed out two carved-stone lions positioned at either side of the main entrance to Jet Aviation. The architect of the facility remodeling was Chinese, and the placement of the lions is supposed to bring good luck. “We’re very good at what we do,” said Hopkins, “but a little luck never hurts, does it?”