With the shakeup in leadership at NBAA, what are your thoughts on the role of NATA in the immediate future?
There has been a vacuum in leadership at NBAA since Jack Olcott left [last year]. This has represented an opportunity for NATA to take more of a leadership role. There’s a good and a bad side to this. The bad side is that in the old days the various alphabet organizations really tried to work together to form coalitions. When we were all agreeing and working together we could get a lot done. I would get a couple of phone calls a day from Jack Olcott and vice versa. I think we will be able to put coalitions together when we need to with NBAA members and the board. At the same time, we would like to strengthen the presence of the business operators.
We represent the people who are making their day-to-day living in aviation. Every one of our 2,000 members are at airports, 24 hours a day in most cases. They have to fight for every penny in a hugely competitive world, a heavily regulated world. These are the most totally absorbed people in aviation. All of our members benefit from more aviation. I think it’s appropriate now for NATA to be in this position where more and more people are looking to us for a leadership role.
What are your thoughts on your incoming and outgoing chairmen?
As you know, the terms of our chairmen begin and end with the convention. Greg Arnold has, without a doubt, been one of the best we’ve ever had. He’s young, very dedicated, with a lot of energy and enthusiasm. He’s also very politically savvy. He can pick up the phone to his senators. And he’s very knowledgeable on the Democratic side. Most of our members are Republicans, as I am, but it’s really good to have someone who can reach out to the other side of the aisle.
Our incoming chairman is Beth Haskins, president of Signature Flight Support. Beth is a tiger. She’s an astute financial analyst, which is obviously important in our industry. She’s got a real ability to get to the meat of the issue. There’s no sitting around twiddling your thumbs when you’re meeting with Beth. She’s also very politically savvy, especially at the airport level. There’s a lot of politics at airports and I don’t think I’ve met anyone who understands how airport authorities work as well as she does.
Of course, Signature is one of the most international of our members. That’s really important to us as we begin to realize that the future of business aviation can be very seriously affected by what other governments do. Now with EASA getting organized in Europe–with a focus on Customs issues, security, taxes, mandatory equipment, certification issues and the question of how charter is dealt with in Europe–plus the airport issues of noise and access, there are a lot of international issues. So it’s great to have someone like Beth with a strong international perspective.
What are your impressions on where we stand with airport access in the U.S.?
It would be nice if I could say there were some global or national trends related to airports. There’s no doubt that more and more communities have come to realize that private aviation is going to be a much bigger element in the 21st century–helping the community to succeed and as a source of employment. I’m very optimistic because we’ve got a great story to tell. On the other hand, we have about two dozen airports that are problematic–and every one is different.
Of course there is the case of Ronald Reagan Washington National Airport. The question is not one of airport security, but rather it totally surrounds the Secret Service’s anxieties about the President. They say it’s about other targets in Washington, but that’s not so. All they’re really concerned about is protecting the President. It’s a priceless airport because of its location. But also because of its location, it means the fearmongers over at the Secret Service will never, ever give in. If we are successful, it will be in the face of continued opposition from them.
The real question becomes, “Can we generate sufficient political support to overcome the Secret Service?” It comes down to petty bureaucratic politics. Somebody in the government has to say “no” to the Secret Service. The person who says “no” has to have a really strong backbone, which is not in long supply in Washington. Because we’ve gotten Congress to come out so strongly in favor of opening up access to Washington National, the bureaucrat who has to defy the Secret Service can say that he has support. It’s kind of like a backbone transplant.
At the same time, it makes me almost happy to have had the problem, because it’s given us the opportunity to go to every member of Congress and lay out the case for why business aviation is good for the country. It’s been the silver lining.
What are your comments on the controversies involving local control at airports versus federal control?
A congressman in northern New Jersey doesn’t have the right to put a weight or noise limit on traffic on I-95. The government has essentially said it’s a national highway system. He doesn’t have the right to put a limit on Amtrak, either. The railroad line has houses all along it. I’m sure those people don’t want to hear the train go by at two o’clock in the morning. But can the local congressman say, “We’re going to put a weight limit on Amtrak between midnight and four in the morning.” No. A local congressman can’t even pass a federal law that limits the noise of motorcycles driving up and down the road. It’s clearly wrong.
In a moment of idiocy, Congress took away the “promote aviation” mandate of the FAA. It redefined the FAA as a safety agency that is toothless in the sense of promoting aviation. We really have to have a national policy on airports. If you unravel the national airport system one airport at a time, before long, the whole thing falls apart. We’re working to make the federal government assert more power.
If there is one hero over at FAA in this battle, it’s [associate administrator for airports] Woody Woodward. She’s been really solid in asserting that the airport system is a national system.
There have been victories in St. Petersburg and Naples, Florida, but the sad thing is that each of these battles takes hundreds of thousands of dollars in legal fees. Nothing makes me sicker than spending money on lawyers.
Is this a case of aviation having to fight every inch of the camel’s nose under the tent, or is there room for compromise?
There is certainly room for compromise. We have a responsibility to minimize the unwelcome impact of aviation. But if anti-airport groups were really concerned about protecting communities from airport impact, then they would put zoning around the airports prohibiting residential development within the 60-decibel noise zone. When you fly into Westchester County Airport [N.Y], you see those condos just a couple hundred yards away, right on the centerline of the main runway, then you say, “Okay, political leaders. You allowed that to be built there. We didn’t put it there. You’re doing nothing but creating activists against the airport. Why do it?”
Of course the real reason is to get more tax dollars. The developers are bigger campaign contributors. We have got to assert at the local level that zoning is important. But they continue to bunch houses closer to the airport. Having said that, I think that there should be, over time, some restrictions at specific airports on Stage 2 arrivals at certain times. But it will have to be done with the community and industry working together.
At Jackson Hole, Wyo., apparently they were successful in imposing noise restriction, without an FAR Part 161 study. I’m not clear on how they did that.
I don’t know either. Of course that airport has a unique relationship with the Park Service that makes a difference. I have been out there and spoken to that airport board, and I have never seen another airport board that is so totally on a different planet. But of course it’s a unique spot. No doubt about it. I don’t understand how they did it.
What about commercial service at general aviation airports?
It becomes a real boogieman. People against airports, more often than not, are terrified of the airport becoming “the next Newark.” We don’t want that either. We want the airport to be a robust, healthy general aviation airport. In the best of possible worlds, we’d like a little bit of commuter traffic coming in. We have members who make a living selling fuel to regional jets. We understand that a couple of RJs coming in–like at Charlottesville, Virginia–is not a hassle. They’re quiet airplanes.
But the local community sometimes says, “Oh, once the RJs start coming in, it’s not long before the bigger airplanes arrive.” We have to dance very carefully on the question of commercial service. As always, it depends on the airport. In a lot of cases, we agree with the local people that we don’t want commercial service. I was down at DeKalb-Peachtree Airport [in Atlanta] last week. Why do we need commercial service into PDK? We don’t. Why do we need commercial service at Teterboro [N.J]? Where the hell would we put it? It would just bollox things up.
Up at Westchester, you can see how just a little bit of commercial service creates a lot more hostility than you would have if it were just a general aviation airport.
Of course, for the businesses at some airports the commercial service is very important. It’s one reason they can support the infrastructure that wouldn’t be as healthy otherwise. They wouldn’t have the approaches and so forth.
For the next torching-off point–insurance.
Argh. There is nothing that has angered me more than insurance. We are so on the wrong end of the supply and demand equation. We have only three underwriters now. They have such a seller’s market.
What happens in sellers markets sometimes is that the sellers throw their weight around so carelessly that they make enemies and burn bridges. Talk to some of the flight schools and piston repair shops. We’ve got members saying, “I’m never going to touch a wrench to a piston engine again. The insurance industry just crucifies me.” It’s almost as though the industry’s future is being decided by three insurance companies, and that’s not right. We need a more competitive insurance market. We need more suppliers.
This year, however, it is clear that the peak has passed. Some of our members are reporting slight reductions for the first time in years. Most are still seeing increases.
One of the things NATA has done is to try to reduce losses through the Safety First program. It’s one of the great successes of this association. We started it from scratch and in five years it has built up to a wonderful program. The companies involved can clearly show that it has reduced their claims. The sad thing is that we haven’t seen the insurance industry coming back and saying, “Now that your claims are coming down, we’re going to lower your premiums.” But before long, insurance companies are going to be looking for companies that are part of Safety First.
What is your crystal-ball view of the air limo concept and compact microjets in general?
The highlight of this year’s convention will probably be the panel we have on microjets. Cessna is going to be selling a lot of Mustangs. Eclipse is going to sell a lot of its airplanes. I don’t know how many others will make it, but I feel very confident in Cessna and Eclipse–probably two or three others.
Whether or not there is going to be an air-limo thing–that’s going to be one of the core questions in the rewrite of FAR Part 135. Under existing 135 rules, I think it would be very hard for an air-limo operator to have a viable business model. There would have to be changes.
What would have to change?
Typically a new aircraft that tries to get into Part 135 circulation has all sorts of very strict maintenance cycle times and so forth, because it’s a new airplane and hasn’t been tested [in service]. It takes time to get up to levels of reliability that enable an operator to hold maintenance costs down.
There are also questions about the single-pilot issue and weights. We may need to come up with something like Subpart K for Part 135–sort of a 135M, for microjet. Something that creates affordable rules that enable these companies to do business.
Another big factor is the insurance question. Given the current insurance environment, I’d be very surprised if a charter operator could insure these airplanes at a viable price.
I don’t want to throw cold water on the microjet issue, though. Could they operate for, say, $300 an hour, and can they carry a family–two adults and two kids? Let’s say they can price themselves at $400 an hour. And you can go 350 miles for $400 with four people. That starts to be very attractive to a lot of people. There are a lot of talented people looking at the questions that go along with this subject.
One thing I will say, if you look at the history of aviation, you’ll see that we’re really bad at predicting what will happen 10 years out. In 1994, would you have predicted NetJets would be the size it is now? Would you have said Southwest Airlines would be the only one making tons of money in aviation? That we’d be talking about UAVs? It’s not out of the realm of possibility that we could have several thousand of these microjets flying in 10 years. But there are a lot of hurdles. The current business model clearly has to change.
You mentioned the microjet panel. What else are you looking forward to at this year’s convention?
Well, our two big award recipients. Admiral [James] Loy [deputy secretary of the Department of Homeland Security] will receive our distinguished service award and [FlightSafety International founder] A.L. Ueltschi receives the William A. Ong award. We also have [Rep.] John Mica [R-Fla.] coming out. We think the world of him.
We have a lot of FBO-specific issues. One of them is the question of how many FBOs there should be at an airport. Should you have one or two FBOs that are making money, or a third so no one is making money? More and more airports are realizing that everyone wins when you have one or two healthy FBOs.
Fuel discount programs are always an interesting issue and we have a panel on that. The cards are very problematic for the FBO. A lot of our members really get annoyed when, they are open 24 hours, trying to get and train workers, accepting all the insurance risk, and someone with nothing more than a computer and a telephone comes along, skimming off the cream of the profits.
Then there are the sessions addressing the regulatory world. I continue to believe that our industry is overregulated by a factor of about two. I’ve been asking, “Should we press harder?” I think we’ll be working with our friends at the FAA making sure they don’t rush down the path to more regulation, as they did on the air-tour rule, for example.
But I’m looking forward to the microjet panel. Those airplanes are really going to change our lives more than anything else.