Slovenian business aviation services firm Elit’Avia has seen an uptick in requests for programs in its “aircraft, crew, maintenance and insurance” (ACMI) offerings, as more clients look for turnkey services rather than traditional aircraft management services.
“We are seeing a significant shift in business aviation access and ownership models,” said Elit’Avia CEO Puja Mahajan. “Overall, the total number of [aircraft sales] transactions is declining while ACMI arrangements are becoming more prevalent. This is particularly significant because many clients choosing ACMI have the resources to pursue full ownership.”
Over the past year, fewer clients have approached Elit’Avia after acquiring a new aircraft and seeking a traditional management arrangement, said Elit’Avia sales director Menelaos "Manny" Kapranos. While these customers are capable of purchasing an aircraft on their own, they prefers a company like Elit’Avia to line up an arrangement, such as a relatively young aircraft from a leasing company or from an existing owner willing to participate in an ACMI arrangement with another client rather than relying on charter to build up hours, he said.
Mahajan pointed to several possible factors in this trend, including a preference to treat “business aviation as a typical operating expense and avoid…the capital expenditure of ownership. Other clients favor the additional layer of discretion that goes with leasing versus owning.” Customers have been looking to reduce complexity, added Kapranos, and seeking turnkey offerings.
The company, which is now 10 years old, initially focused on Russia and Eastern Europe. Its services have expanded globally, particularly throughout Europe, the Middle East and Africa, and the company now has close to two-dozen aircraft in its management fleet, three air operator certificates and 120 employees. “We are growing at a steady clip,” Kapranos said. This growth occurred during a period when the market had been unsteady in Europe, but he said the company is hopeful that the region is past the trough. Kapranos credits the array of offerings and flexibility of programs to not only its survival during this period, but also helping to build its business base.
“We are uniquely positioned to manage these changes because we have more than a decade of experience with all aspects of business aviation, including crew support, ACMI and managing privately owned aircraft,” said Mahajan. “For clients specifically seeking an ACMI arrangement, Elit’Avia leverages its network to find the most suitable aircraft for the mission—whether it is within our fleet or from the open market. Our true differentiator is our ability to select the optimal aircraft and complement it with comprehensive tailor-made services.”