The FAA announced last week that it dedicated a new control tower at LaGuardia Airport (LGA). It replaces the current traffic control tower that was put up in 1964. LaGuardia is obviously a very busy airport that handled more than 400,000 takeoffs and landings last year in 2010. The U.S. Transportation Secretary, Ray LaHood, in a statement indicated:
“LaGuardia Airport plays an important role in our country’s aviation infrastructure,” said Lahood. “This modern tower will help enhance the safety and efficiency of air travel in and out of the New York metropolitan area.”
It is reported that the tower will be equipped with the latest aviation technology, including the Airport Surface Detection System Model X (ASDE-X), which allows controllers to track surface movement of aircraft and vehicles. Controllers will also be using the Integrated Control and Monitoring System (ICMS), which consolidates information including navigational aid displays into one screen.
FAA Administrator, Randy Babbitt stated in a release:
“Today marks a culmination of years of hard work by many people both inside and outside the FAA,” said Babbitt. “This tower symbolizes the direction the FAA is taking by transforming the future of aviation with new technology.”
Some of the specifications of the new tower include that the new 233-foot high tower is 82 feet higher than the previous tower and has an 850 square foot tower cab. The total cost to design, equip, and construct the new tower was approximately $100 million.
In a report a week ago JP Morgan North American Equity Research analyst Joseph Nadol III indicated that there is a “significant overhang” of pre-owned jets available at attractive prices. This makes for bad news for new jet sales which he described as “anemic”. He indicated that new aircraft sales were continuing to decline and stated:
“We see potential for further rate cuts if orders do not pick up. However, there are reasons for optimism. Global corporate profits were up an estimated 46 percent in 2010, and they have historically been correlated with bizjet deliveries, though there is a one- to two-year lag.”
The report revealed that used business jets have trended down since the middle of 2009 and are now 3 points off of the peak sales. The trend included a .4% drop from 11.7% to 11.3% last month. Nadol stated, “The bad news is that even after this decline, inventories remain at a level identical to the 2001 peak.” This does not bode well for new business jet sales but if the trend continues it could mean a turnaround. The growth for 2012 is forecast at 20% and JPMorgan opines that if the demand picks up, that the industry could meet that figure. If orders do not continue to increase or do not pick up, the forecast of recovery may be longer than the next two years and will be longer. The report said, “If orders do not start coming in, the recovery will get pushed out.”
For those of us selling pre-owned business aircraft this report was not necessarily bad news but for the manufacturers looking for new jet sales, they are probably “cautiously optimistic”, but yet only if the amount of pre-owned jets drop.
The Gulfstream 650 continues to use and test its aircraft under serial number 6001. Recently, Gulfstream, the jet manufacturer that is located in Savannah, Georgia, flew its S/N 6001 on a test flight using only an electrically powered, fly-by-wire (FBW) backup flight-control actuation system. The entire flight was approximately 3 1/2 hours and four pilots were on board to test the system which was ran about 2 1/2 hours and during that test time the jet performed 5 landings using the FBW system.
The system is different from most as it works on electric backup instead of using hydraulics like most systems. Gulfstream’s FBW is designed for the G650 as electric backup hydraulic actuators (EBHA)–one at every primary control surface (elevator, rudder and aileron) and the outboard spoiler. This is great news and the Senior Vice President of programs, engineering and test discussed the test stating:
“The system performed flawlessly. There was no difference in handling qualities between the electrically and hydraulically powered modes.”
This is good news for the Gulfstream team that is working on the 650. Personally I am watching the progress of the Gulfstream 650 as this jet has always been one of my favorites, ad who knows I may some day have the Gulfstream 650 as part of my fleet.
Here is hoping everyone has a dream, and those dreams are realized in 2011. Thank you for reading here at Corporate Jet Insider. Enjoy your holiday, be safe and happy.
According to reports the business use of corporate jets has increased in a year over year analysis. The number was 4.4% reported last month and was a year over year figure. Part 91 flying increased 10 percent while it rose 12.2% in November. This is another comparison to the same time last year and should not be thought of as just due to the holiday increase. Fractional flying only rose a mere 2.4% so we did not see increased used across the board making for just an overall increase of 4.4%
In spite of the increase in use of corporate jets in the industry, safety remained relatively unchanged. In a report by Boca Raton, Fla.-based industry safety analyst Robert E. Breiling Associates it was stated that there was just one more accident last year involving U.S.-registered business aircraft than in the previous year, with the total business jet accidents rising to nine from eight.
It is nice to see that safety remains nearly unchanged in spite of the increased use. The turboprop industry was somewhat more increased and that could be due to its increased use, but corporate jets remain a safe alternative to commercial flying and we like to see these numbers. If you are looking at safety as a reason not to choose a private aircraft it has great numbers.
It has been reported that Representative Jerry Costello, (D-Ill.) is once again championing the issue for business aviation on use fees to be charged. Representative Costello serves on the House Transportation and Infrastructure Committee, and he has issued a statement on Friday urging President Obama not to include general aviation user fees in the upcoming budget. He put forth in the statement:
“We want to reiterate that a user-fee proposal would be a step backward,” he wrote. “This is an issue that we have had bipartisan agreement on in recent years and there is no reason to reconsider it. I will not support a budget or an FAA reauthorization bill that includes user fees.”
Representative Costello is rallying support across congress to support his measures. Another that has noticed and is also rallying behind Representative Costello is National Business Aviation Association president Ed Bolen. President Bolen is applauding Costello’s efforts and joins in his position on usage fees in business aviation. Currently the business aviation industry supports funding of the FAA through the use of a fuel tax and that seems to be the tried and tested way of funding and not any as yet untested use fees. It appears that it would be a tough road to have usage fees change the way we fund the industry association through this source.
I was just discussing funding of the FAA and how the business aviation industry works with those issues through the fuel tax and not through usage fees. It seems that they will need to dip into the fuel tax to fund a problem they are having with their Next Generation Air Transportation System (NextGen). The problem is in the software of the new system. AIN recently reported the issues with the NextGen as it stated:
“the FAA’s new, $2.1 billion en route automation modernization (Eram) computer system, originally scheduled to be operational at all 20 air route traffic control centers (ARTCC) last year, could incur repair costs for the agency of up to $500 million.”
This is a set back for the agency and can mean some difficulties for the industry going forward. The full report from the DOT Inspector General was sent to Congress.
The technology that we currently use is more than 30 years old and is in need of replacement. The current system is being replaced by Lockheed Martin. It was also reported that in July, the IG found that subsequent operational testing at the St. Louis ARTCC raised more than 15,000 software issues, requiring a continuing estimated $12 million per month to troubleshoot and repair–at the FAA’s expense. This is not good news for the FAA budget, and it is not putting a lot of confidence in the new system set to replace its older counterpart.
The new Florida governor is keeping a promise to residents of Florida and is selling off the private jets owned by the state. The newly elected Rick Scott has directed his staff to liquidate the two business jets owned, a 2000 Beechcraft King Air 350, and a 2003 Cessna Bravo. This is seen as a political move that will obviously be seen as a way for the state to cut back on costs and will add to the difficulties faced by the business aviation industry to not be seen as a perk business for others. Florida’s governor stated:
“The privilege of using a state-owned aircraft is an unnecessary burden to taxpayers, especially when lower-cost travel options exist.”
An interesting understory to the issue is that the governor used his own private aircraft during the campaign trail to be elected to the governor’s spot. According to the Florida Aviation Trade Association executive director, Paula Raeburn, the governor knows about the benefits of using the business aircraft as a business tool as she stated:
“Scott used his own corporate aircraft extensively during his campaign, so he knows what a resource and business tool an aircraft is.”
The business aircraft will be sold at auction on February 9, and experts are believing that the bids on the aircraft will begin at about $2M. The average of the cost of the aircraft is about 2.75M according to reports. It will be interesting to note if the new governor will use his own aircraft and bill the state for its use or asked to be reimbursed for the use of his own aircraft.
The Chinese business industry is continuing it meteoric rise and the numbers coming from China related to its business market can be staggering. This is good news for the likes of business jet sellers all over the world. The demand for business jets in the country are rising as fast as the business market itself. Recently in the world of business aviation it was announced that the trend continues. David Tang, the attorney and business aviation consultant for Minsheng Financial Leasing has announced the intention of the company to increase its fleet and its intent to purchase more jets for its fleet. At the end of the year in 2010, Minsheng Financial has placed orders of 17 business jets.
The jets that have been ordered include Gulfstream, Hawker Beechcraft, Cessna and Dassault Falcon. It is unclear what numbers are associated with each company however the company has already taken delivery of a Gulfstream 450. The company was formed under backing from a couple financial institutions in April 2008. The company is seeing its future rise and the needs for its business aircraft is increasing as well. This is indicative of the market in China and we will see many new companies formed and their needs for corporate jets rise throughout the coming years. My friends in China or those doing business with the country are all trying to keep up with demand. Business jet sellers and buyers might look to the country as a place to do further business.
Many people increase their travel in and around the holidays. This means good news not only for the commercial travel industry but for the private and business aviation as well. The travel increase means that for most charter companies that provide jet travel saw an increase in their booked flights and saw prices increase a little. Now that the holiday season is over and we are going back to the status quo in the world of private travel, In fact it has been reported that private charter flights are now down 50% from this time last month. Charter flights are down and the bookings of that type of travel has gone back to pre-holiday levels. It is nice to know that people are still booking at the previous level.
Further good news is that prices are not only staying current but might have had some of an upswing in charter jet prices. The global price index was stated by Avinode at 97.37 and that is up almost a point from this time last month. We here in the North American market may not have the same increase s prices for charter flights were seen as “softened”. Hopefully, we will see increased usage of private jet across the industry in the future.
