NBAA's regional forum series proving successful

 - July 28, 2008, 11:55 AM

In the mid-1980s, NBAA’s annual conventions were drawing about 70 aircraft on the static display line. At last month’s New York-area NBAA regional business aviation forum and static display at Farmingdale, Long Island, there were 41 business aircraft on the ramp, spreading out and filling a closed runway for the one-day event. Joe Ponte, NBAA v-p of membership, marketing and regional programs, proclaimed the fourth such mini-trade show to be an impressive success, despite a continuation of the dismal weather and low ceilings that had plagued the Northeast throughout the spring.

“A lot of key flight department personnel, vendors and sales prospects can’t justify the time or expense to travel to the ‘big’ NBAA convention,” said Ponte. “Our hope is that driving an hour or two for a local one-day event such as this may be an option for a lot more folks, including non-aviation members of the community who may be interested in what goes on at the airport. The bang-for-the-buck is here at these events.”

Participation is growing. At the first local forum at Chicago DuPage Airport in June last year, there were 26 airplanes and 1,200 registrants. Last November in Dallas, 1,500 registered to see the same number of aircraft. Last March in Long Beach, Calif., 1,700 showed up on a sunny day. There were 37 aircraft on the ramp. Though only 1,400 attended the New York-area forum with its 41 aircraft on static display (and 59 booth displays), Ponte still considered the event a step forward, given the weather and the fact that the Long Island location was far from convenient for many prospects in the Big Apple market.

“I grew up in New Jersey,” said Ponte, “and to me, Long Island might as well have been on another planet.” The four AIN staff members who negotiated rush-hour traffic to travel to the show from New Jersey and Connecticut can confirm Ponte’s assessment. The association v-p said NBAA would consider a second New York-area event located at an airport more convenient for those west of Manhattan.

Events began early at the forum, with the display area and opening sessions beginning at 8:30 a.m. after a continental breakfast. Topics of discussion throughout the day included pre-purchase inspections; Teterboro Airport, N.J., departure routes; corporate aircraft insurance; aging aircraft; high-altitude airspace redesign; the business aviation concept buyer; international IS-BAO best practices; aviation security; RVSM compliance; and upset recovery.

At 9 a.m. NBAA past president Jack Olcott welcomed visitors in one of his final appearances in that role. He handed over the reins to Shelley Longmuir on June 24 (see page 1), but will remain involved with the association as a consultant. Olcott later introduced panelists at the “concept buyer” forum and provided a glass-half-full overview of the state of the industry as he leaves his executive post at NBAA.

“U.S. airlines have cut their markets by 10 to 40 percent. There are fewer airline options. Business aviation activity is up 12 percent from pre-9/11 levels. International [business aviation] travel is up. Most important, business aviation has become an ordinary means of travel, now accepted by shareholders, the media and even politicians.”

Forum panelists included Wilson Leach, managing director of AIN; Gil Wolin, publisher of Business & Commercial Aviation magazine; and former Ford flight department chief Phil Roberts, now president of consulting firm PAR Travel Tech. They outlined some of the challenges to finding and landing the elusive concept buyer for business aviation services. Concept buyers could include customers for whole aircraft ownership, fractional ownership, charter and a host of in-between programs. One such option, Marquis Jet Partners, allows travelers to access its NetJets fractional shares without having to commit to an equity purchase. A more traditional approach, block charter allows customers with predictable charter requirements to save money by committing to a fixed number of hours within a given time frame. Wolin outlined some of the barriers to industry growth: the war, security concerns, airport access, noise resistance from local communities and the faltering economy.

Addressing market timing, Leach pointed out that it’s still a buyer’s market at all levels of business aviation, but if the economy truly has started to recover, the wide-open window of opportunity for consumers may be inching closed. To illustrate perspective, he noted, “From 1995 to 2000, the business aviation industry quadrupled. We went from $2.5 billion in backlogs to $10 billion.”

But, Leach said, one indicator of the health of the industry is the size of the used aircraft inventory, particularly late-model aircraft. The larger the inventory of used aircraft on the market, the lower the prices and the more difficult it is to sell new aircraft. “Currently,” he said, “out of a fleet of between 12,000 and 13,000 business jets, some 2,000–about 18 percent–are for sale, a relatively high percentage.” The result, he said, is an increase in options and hefty negotiating power for those customers getting involved in any facet of business aviation.

Consultant Roberts offered some tips on focusing on the concept buyer. He said, “Ask the right questions. For instance, ‘Why do I want to get into business aviation?’ Have the prospect write the answers down in his own words–‘safety, convenience, privacy, speed of customer response.’ Then you have something to work from.”

Olcott concluded the session by reiterating that there are currently 100,000 companies that NBAA has identified as being good prospects for using business aviation. Of those, 10,000 are directly involved in using aircraft. Another 10,000 use charter. “We’re currently reaching 20 percent of the available market for our services. What can we do to improve on that?”

More regional forums such as the one in Farmingdale may be part of the answer for NBAA. Ponte said the association may fit one more in after the national convention in Orlando, Fla. this October. He said of the regional-event format, “It’s a proven concept. We may need to refine, expand and develop it, but we know it works.”