Basel and Business Jets: where the magic happened

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MRO / EUROPE / ON THE FLY | 20/12/2016

Over 120 people came to Basel/Mulhouse (BSL/MHL), Switzerland on November 24 for the first edition of the Basel & Business Jets Conference, co-organized by CAMO4jets and Jet Aviation.

The conference’s theme was taking the audience through the complete Basel experience, from the acquisition of a new aircraft through to its operations and everything in between. To kick things off, Jet Aviation President Rob Smith provided an overview of where his company is heading in the near future. As the company prepares to celebrate its 50th anniversary next year, he had plenty of good news for operators, including new facilities in Macau the recent acquisition of AvJet in Los Angeles, CA. But even as the company continues to grow globally, its heart and soul remains in Basel. “Half of all the employees at Basel Airport belong to Jet Aviation,” he says.

The acquisition phase

Turning to the acquisition process, Boutsen Aviation Executive Vice President Mathieu Pezin outlined the importance of the pre-purchase inspection (PPI). “The first step should be to take a demonstration flight,” he urged. “The PPI’s scope may differ depending on when a major check is due, but with a demo flight you are ensured any issues will be included.”

According to Pezin, as the buyer is responsible for paying the PPI, the facility is legally bound to tell the owner about any airworthiness issues. “An experienced broker can help protect a client’s interest by defining the PPI between all parties, including the MRO,” he says. “It is the broker’s role to educate the client on who is responsible for what and how long it will take to repair and how much it should cost.”

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Air Law Firm Partner Diego Garrigues

Another important step in the acquisition process is for a new owner to carefully read the manufacturer’s warranties and make sure all parts are covered by a warranty – including the paint. “Warranties come with limitations, so it is important to read the carefully,” says London-based Air Law Firm Partner Diego Garrigues. “Although the first draft will not contain remedies for the buyer, manufacturers are usually happy to insert some damages if you ask.” He also pointed out that the aircraft will be taxed based not on registration but on where the aircraft is located and what the intended end use is. “For this, it is essential you seek the advice of a tax advisor specialized in aircraft.”

Advice for leasing

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CAMO4jets Managing Partner Colin Birkman

For those not in the position to buy an aircraft, there is the option to lease a business jet. On this, CAMO4jets pulls from its years of experience in the commercial aviation sector to advise its business aviation clients. “It’s important to look at the terms and conditions of acceptance of the leased aircraft and account for the differences between its operational use and return,” says CAMO4jets Managing Partner Colin Birkman. He recommends finding an attorney who understands this: “After all, aircraft are essentially a group of high value components – airframe, engines, APU, landing gear, etc. – the sum of which is the total value,” he adds.

Furthermore, Birkman stressed that it is vital to ensure that MRO is properly performed before the aircraft goes back to the lessor. “It is essential to understand the real life cycle of a business aircraft,” he says. “Look at what the agreement actually says and what the actual condition of the aircraft is.”

Perhaps the most important factor in leasing an aircraft is good communication between all parties involved. “Read and understand the lease before signing it, factor in realistic time scales for overhaul, get the complete aircraft history before taking it on and visit the aircraft before adding it to the books,” concludes Birkman. “At the end of the day, poor record keeping by a lessee may render the aircraft non-compliant.” On this point, he recommends using an expert, which can make the difference between defining what is ‘overhaul’ and what is ‘refurbished’ – an essential difference considering that unapproved repairs and modifications can be both difficult and expensive to fix.

A changing interior

Heading inside the aircraft, a recurring theme is the increasing complexity of aircraft interiors. According to Jet Aviation Vice President of Completion Sales and Marketing Matt Woollaston, the advent of new all-digital, all composite types means new challenges for intellectual property. For example, anyone buying a new Boeing 787 Dreamliner has to send elements of their completions requirements back to Boeing in order to have the OEM create the necessary software. “The buyer has the right to ask the OEM to offer up a royalty waiver for the first purchase, but this is not automatic, meaning it is important to look at as these rights go as soon as an aircraft is sold,” he says.

dsc_6224As a result, completions centers must first perform an analysis on a design and engineering package be providing this to the OEM for structural and decompression tests. Of course this cost is typically not built into the purchase price unless previously negotiated. For this reason, Woollaston recommends having the interiors house provide a cost estimate for a potential design as the manufacturers may well err on the light side, meaning the aircraft will perform better on paper than in practice.

Compliance and maintenance

Beyond purchase it is important to be mindful of the latest developments in operations. In Europe, for example, Part NCC has caught many people unaware. According to attorney Philippe Renz of Renz and Partners, anyone wishing to operate their aircraft under the new regulations must make sure they comply with all legal and insurance requirements. “My main concern is a scenario where an accident happens to an aircraft yet not properly registered under Part NCC, meaning the flight will be deemed illegal,” he says.

dsc_6089A panel discussion on maintenance milestones saw CAMO4jets founder Jozef Mihalicek, Mjet COO Konstantin Essler and Jet Aviation Director for Bombardier, Embraer and Gulfstream Erik Vandergrift outlined how important it is to adhere to published schedules as far as possible – although this almost never happens. Jet Aviation’s safety and compliance manager Dominic Waeckerlin closed out the seminar by explaining how to bring MRO into day-to-day operations.

The day also included a tour of Jet Aviation’s maintenance facility and an evening cocktail.

The wizards of Basel

While there were no real spells cast last week, the educational day paid testament to the true technological wizardry of the men and women involved in business aviation in Basel. Harry Potter eat your heart out.

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