Down but not out

WEEK 22 - REPORT (EBACE - Liz Moscrop)

Europe’s business aviation community gathers its resources to face the continuing challenge of political uncertainty, declining oil prices and sluggish sales. Liz Moscrop reports from Geneva.

Europe’s business aviation industry continues to hold its breath as we head towards its annual marker in the sand – the 2016 European Business Aviation Convention and Exhibition (EBACE) this week. On the surface it looks like not much has changed since last year in Europe. According to the General Aviation Manufacturers Association (GAMA) Q1-2016 results, there were 83 European aircraft shipments for the beginning of 2016, compared to 85 this time last year. The general aviation industry as a whole shipped 614 aircraft in the first three months of the year for a total value of $4.5 billion. “The entire industry is feeling the impact of retrenchment in the energy sector, as well as global geopolitical and economic insecurity,” comments GAMA CEO Pete Bunce.

Also read: GAMA report shows Q1-2015 deliveries down

Global business jet deliveries declined by 4.7%, from 128 in Q1-2015 to 122 in Q1-2016. One thing to consider is that these deliveries represent orders from years past and, as such, the general consensus is that sales are down.

On the bright(ish) side, business aircraft flights in Europe were up 0.1 percent last month, with 63,602 departures recorded, according to the latest figures from research consultancy WingX Advance. This marks a slight improvement on last April’s activity, which saw flying down 0.8% year-over-year, with 62,968 departures. The boost comes from business jet activity, while turboprop and piston flights dropped between 2 and 3%.

However, year-to-date, flying in the region is lagging 2015 by 1.6%, and this is on top of the drop from last year, where figures fell 2.7% on those of 2014. “The declining trend in the first quarter did not extend into April, with stabilization in the UK market and growing activity in Germany making for a small recovery,” says WingX Advance Managing Director Richard Koe.

Must read: Bright spots in gloomy European forecast

Flights were up in all markets except Switzerland, with Germany and Spain performing best. There were also upticks in flights from Norway (up 8 percent), the Czech Republic, (10%), and Belgium, (up 15%). Unsurprisingly, arrivals from Russia fell by 11%. Transatlantic flights were up 5 percent, while Middle East connections climbed 2%. Very light jets came into their own with a 22% growth year-on-year over April 2015. There was also an 8% increase in ultra-long-range flights and 2.5% growth in light jet activity.

The main drivers to this decreasing trend seem to be the collapse of the Russian and CIS market, falling oil prices, and the Brexit factor.

Some positive numbers

As we head to Europe’s annual gathering of the minds, the EBAA has produced some useful statistics to help its members combat poor perception of some areas of business aviation, and to encourage more people to fly privately. The EBAA recently commissioned Booz Allen Hamilton, in collaboration with Deutsches Zentrum fur Luft-und Raumfahrt (DLR), to identify and quantify how the sector impacts the European economy. Using a combination of desktop research, expert interviews, and the analysis of large industry data sets, the study demonstrates the value of business aviation. Highlights include reduced costs, gains in productive employee time, and the total number of jobs supported by business aviation.

One of the key takeaways of the report is the Gross Value Added (GVA) of the monetary worth of the production generated by  the sector. For example, there are 371,000 jobs directly or indirectly dependent on the European business aviation sector. It produces EUR 98 billion in output, EUR 27 billion in GVA, and EUR 21 billion spent in wages and salaries.

Better access

There have also been some positive movements in terms of gaining access to more airfields. EGNOS is a free alternative to costly, ground-based ILS navigation aids and compliant with ICAO Annex 10 Category I precision approach performance requirements. The system uses geostationary satellites and a network of ground stations to receive, analyze and augment GPS and, soon, Galileo GNSS signals. EGNOS-enabled LPV-200 (Localizer Performance with Vertical guidance) supports lateral and angular vertical guidance with a decision height of 200 feet. This is similar to that provided by ground-based navigation aids, but without the same financial burden of installing, maintaining and calibrating ground equipment.

Earlier this month, the first LPV-200 approaches were implemented at Paris Charles de Gaulle (CDG). At the close of 2015, over 200 EGNOS approaches were operational at 120 airports in 18 countries. The goal is to have 440 procedures operational by 2018. EBAA CEO Fabio Gamba said, “I believe access is crucial as business aviation’s added value is our flexibility, and access is what allows us to be flexible,” says EBAA CEO Fabio Gamba. “We have EGNOS, so let’s use it in the best possible way.”

Must-read: Airport access – a space odyssey

A more down to earth upgrade comes in the form of Italy’s AgustaWestland, which last month completed ground runs for the third prototype of its AW609 TiltRotor (A/C3) at the company’s Leonardo-Finmeccanica‘s facility in Cascina Costa, Italy. When certified, the AW609 will be able to take off and land vertically and fly at up to 275 knots at an altitude of 25,000 ft in a pressurized cabin. These tests prepare the prototype for FAA certification flight-testing this summer at the company’s Philadelphia facility.

AW609 In Flight

Weathering the storm

Business aviation in Europe is a mature sector and the players have weathered stormy times before. In tough times, the entrepreneurial players rally together to come up with innovative solutions to complex problems, as evidenced in a cracking EBACE conference line up. The opening general session, for example, includes aircraft owner and user Bassim Haidar, Group CEO, Channel IT Group, who speaks alongside politician Bernard Kouchner, the former French Minister of Foreign & European Affairs, and Patrick Ky, the Executive Director of EASA.

Having politicians understand the value of the sector is a vital part of its continued growth. As GAMA’s Bunce says: “Despite these headwinds, our industry continues to invest in research, development, and certification of more efficient and safe products. Therefore, actions taken by elected officials to stimulate R&D and improve regulatory efficiency have a far-reaching impact on the economy.”

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