EBACE Convention News

Oxford Airport’s Hangar8 Is Geared For Growth

 - May 21, 2013, 3:45 AM
Hangar8 has seen spectacular growth in Africa, mainly associated with oil, gas and mineral industries. The Hawker fleet is particularly busy in this region.

Last month London Oxford Airport-based Hangar8 welcomed two additions to its growing fleet of aircraft available for charter–a pair of Bombardier Global Express aircraft, operating from Oxford and London Luton Airport. The new jets strengthen Hangar8’s long-range fleet and highlight the company’s continued worldwide growth.

According to Hangar8’s CEO Dustin Dryden, such growth is necessary to survive. “There’s no room in this marketplace for small operators any more. The biggest wins. You could end up with just five big players in this market,” he predicted. Larger operators provide for major savings in terms of buying power–for instance, in terms of training and insurance. “But you must have quality,” added Dryden. “Clients are now more discerning, and bad operators soon fall by the wayside.” Customers are also demanding more transparency in their operators, and partly for this reason Hangar8 is a public company with completely open finances.

In November last year Hangar8 completed the acquisition of International Jet Club at Farnborough. This operator fitted well with Hangar8’s own operations, and added a number of long-range aircraft to the fleet. Most of them are operated solely on behalf of the owners, and the IJC branding is being retained.

Hangar8’s current managed fleet of more than 50 aircraft, with a combined value of around $800 million, also shows a move away from smaller aircraft to larger, long-range types that offer better operating economics. As part of that change, Hawker types (11 aircraft) have been displaced by those from Bombardier, which Hangar8 believes is the most important OEM–it has 12 Challengers and seven Globals on the books. There are also Dassault Falcons, Gulfstreams, Embraers and Cessna Citations, plus four helicopters, operated in South Africa. A Legacy 650 is in the process of being added to the fleet as well. The largest aircraft in the current line-up is a single Boeing BBJ that normally operates from London Biggin Hill.

Asset Management

Hangar8 offers an all-in-one package for owners, providing financial management, flight and cabin crews, operations planning and full servicing. The company handles leasing arrangements and can arrange sales to facilitate clients who wish to “up-size.” The company also arranges ad hoc operations for existing customers who may require a larger aircraft for a short duration.

“We are an asset management business with a logistics arm,” explained Dryden. “We do not see ourselves as a charter company.” Charter is, nevertheless, an important element of the business for clients looking to produce revenue from their aircraft ownership. Hangar8 holds worldwide AOCs in several countries, including from the UK and in Africa, where an AOC is necessary for long-term operations. Around 70 percent of Hangar8’s clients have contract terms of 12 months or more.

Providing a cost-effective, high-end management service to “discerning clients” means that Hangar8 has in place a high-quality training and maintenance program, it said, with maintenance centers in the UK (at the company’s headquarters at Oxford), the CIS and Africa. Having regional centers negates the need for time-consuming and costly transfers of aircraft back to Europe for scheduled checks. The company’s Part M maintenance approval allows it to perform continuing airworthiness management services across all fleet types for aircraft operated under the EASA, FAA, Aruba, Cayman Islands, Bermudan and Isle of Man registries.

All of Hangar8’s maintenance staff are licensed, setting the company apart from many operators, and providing greater flexibility for staff to provide 24/7 cover anywhere in the world. Preventive checks are routinely carried out across the fleet, and most customers opt for a package in which a dedicated engineer is allocated to their aircraft, giving them greater peace of mind.

Growth Regions

Operations are conducted with aircraft based at more than 20 locations throughout Europe, the CIS, the Far East and Africa. While growth in Europe has largely been restricted to the high end of the market, Hangar8 has seen considerable growth in the mid-level market in Africa, where the ground transportation infrastructure can be poor or even nonexistent. The company’s African fleet has grown from two to 11 aircraft in a short space of time; and with its knowledge of the local market, Hangar8 believes it can set up operations almost overnight to meet the requirements of local customers, many of whom are in the oil, gas and mining industries.

Another area where Hangar8 is active is in Russia and Kazakhstan, and further east into Asia. There are exciting possibilities in these regions, believes Dryden, but he said the market is more cautious than that in Africa. “You need to be seen. You need to be trusted,” he commented. “You have to come as a big player.”