Sam Barone Takes The Helm
By Ken Pole
Four hundred and ninety-nine — and counting. That’s the number of aircraft operated by the 518 members of the Canadian Business Aviation Association. The discrepancy arises from the fact that while some CBAA members have several aircraft, others such as fixed-base operators
By Ken Pole
Four hundred and ninety-nine — and counting. That’s the number of aircraft operated by the 518 members of the Canadian Business Aviation Association. The discrepancy arises from the fact that while some CBAA members have several
|Sam Barone has been in the aviation business for 28 years in both the public and private sectors. (Photo by Alain G. Dagenais)
aircraft, others such as fixedbase operators (FBOs), have none and there are fractional ownerships to consider as well.
Mostly a broad range of fixed-wing, but with 14 helicopters, the fleet mixture presents a considerable managerial challenge and the CBAA’s new president and CEO, Sam Barone, is certainly up to the job. Having recently moved over from the same job at the Air Transport Association of Canada (ATAC) and succeeding the equally personable Rich Gage, Barone brings expertise, affability and passion to the CBAA.
Fluent in English, French and Italian (hence the three syllable pronunciation of his family name), Barone has been in the aviation business for 28 years in both the public and private sectors. His federal government experience includes Transport Canada, the Canadian Transportation Agency and the Competition Bureau. Economics degrees and post-grad business studies at Harvard and Queen’s have given him valuable insight into a broad spectrum of aviation issues, international as well as domestic.
Having settled in with a view of Parliament Hill from his fourth-floor offi ce in the capital’s downtown core, Barone began his CBAA tenure with the obligatory review of files with an eye firmly on the organization’s strategic future in a rapidly-evolving economic, regulatory and political environment. In his first few weeks on the job, he visited CBAA chapters in Montreal, Toronto, Edmonton, Calgary and Vancouver for a first-hand look at members’ operational challenges.
“There’s no end of issues facing the aviation industry in general, particularly issues surrounding the cost of doing business, both with airports and our suppliers,” he said in an interview. “We’re also looking at security and border management issues that are continually coming up: the lack of standardization and harmonization, especially here in North America. While we are under the Security and Prosperity Partnership, an initiative that has come about in the last three or four years, there’s no end to the new initiatives that industry has to comply with.”
The environment and aircraft emissions are another hot button on which the CBAA is allied with the International Business Aviation Council (IBAC) within the framework of the International Civil Aviation Organization (ICAO). The CBAA didn’t have a formal position on the “green shift” proposal that helped to scupper the Liberals in the October general election just as Barone was settling in. However, the organization’s position “has always been that anything that adds costs without mitigating greenhouse gas emissions . . . is an issue for us.”
Nor was former Liberal Leader Stéphane Dion’s carbon tax proposal “a very clear signal to the marketplace at a time when we have a good news story to tell.” That’s the fact that emissions as measured in flight hours and number of flights have been declining over the last couple of decades. “Put it in perspective: aviation overall accounts for only 1.5 per cent of total greenhouse gas emissions in Canada and we’re about two-tenths of one per cent of that. We want to play our part but we can’t do it by crippling the job generators in this country and do it such a way that it’s not going to be standardized! We’ve seen a carbon tax in British Columbia; in terms of the cost of doing business, that’s a real concern.”
There is also the inescapable fact that aviation is a captive of technology; designing and manufacturing engines that emit fewer greenhouse gases isn’t done overnight. Barone agreed, adding that the CBAA works with the Washington based General Aviation Manufacturers Association’s environmental committee on what the GAMA says is “rigorous, science-based analysis of environmental issues in aviation.”
As well, CBAA works with Nav Canada and its U.S. and European counterparts on reducing the amount of time aircraft fly. “Airspace management and air traffic secrecy really add needless fuel consumption in terms of crowded airspace,” Barone explained. “We’re fine on North Atlantic tracks but then we reach, for example, New York airspace and have to go into holding patterns, zig-zagging, indirect routing, descent procedures.” The bottom line is that carbon taxes represent “another tax grab without correlation to research and development on alternative fuels or technological R&D on aerodynamics.”
| Sam Barone and his management team. (Left to right) Gail Stubbs, director, fi nance, Terry Stonebridge, executive assistant and director communications, Sam Barone, president and
CEO, Andrew Oestreich, VP, marketing and sales, Bill Boucher, VP. (Photo by Alain G. Dagenais)
The aforementioned traffic secrecy is one element of a broader agenda to tighten security, and while business aviation still enjoys more streamlined cross-border access, even that could be tightening. The U.S. recently published a Notice of Proposed Rule making which would more definitively identify people who travel on business aircraft. Is it something the industry should worry about? Probably not, because corporations and governments see their aircraft as a risk-reduction tool for their people, an easier job than in commercial aviation because the travellers essentially are a known commodity and, as such, tend not to be seen by security agencies as a potential threat.
But there’s no ignoring that since Sept. 11, 2001, security has become a huge private and public-sector growth industry. But inadequate commonality adds to compliance costs. “There are airspace, border management and security issues,” Barone said. “Having said that, we work with Canadian government agencies to ensure that the rules of the game are clear and understood by everyone. . . . But that definitely has become one of the more complex areas for business aviation.”
The CBAA cooperates on security issues not only with the Canada Border Services Agency (CBSA) but also with the U.S. Department of Homeland Security (DHS) through the NBAA and IBAC. Because of the nature of the bilateral relationship and its business linkages, the CBAA also works more directly with entities such as DHS and Customs & Border Protection on big-ticket issues. “We try to leverage those relationships when we can, and we certainly have contact with those agencies,” Barone said. “It is a day-to-day operational issue and by and large it’s pretty smooth, but you always have to monitor that environment to see what’s coming down the pike that can affect flight departments and the corporate and commercial side.”
FBOs, their personnel often better trained and more aware of corporate niceties than many in the public sector, are a key factor. It’s in their interest to facilitate incoming aircraft and then a quick turnaround when required, ensuring that people get to their meetings quickly. “One of the attractions of business aviation is the ability to come in and to clear an aircraft. FBOs play a big part and we partner with CBSA to ensure that we’re compliant at all times.”
Against this often daunting backdrop and the widespread caution in the industry, exacerbated by stock market chaos and uncertainty about fuel prices, many companies evidently see an opportunity to re-equip their fleets. Honeywell Aerospace’s latest outlook points to nothing less than a 22-per-cent surge in new aircraft deliveries in 2008 over 2007 (for a related article on the 17th annual Honeywell Business Aviation Outlook, called “Business Aircraft: A Booming Market” please visit www.wingsmagazine.com and go to web exclusives). There is strong demand for more fuel efficient, quieter and longer range aircraft. Although aviation may not be a core business for many CBAA members, they have a tendency to increase their amount of flight time in order to maintain customer contacts and relationships.
While those who are aware of the value of business aircraft don’t need convincing, what about shareholders? The archetypal umbrella-wielding grandmother who makes noise at shareholder meetings? Barone said there are studies showing a positive correlation between shareholder values and business aviation. “Volatile times . . . are actually when companies have to become ever more competitive. Customer contact is crucial, managing assets away from head office, and the ability to move people, parts and equipment becomes a glaring advantage of business aviation. It’s not as evident in good times, but it does become evident when things slow down.”
Accordingly, he said, business aviation is here to stay, no question. “Canada has a long legacy of business aviation; it opened up a lot of remote resource development areas in this country. I think that will not change . . . Our solid banking system and our resource economy will be going strong and, given that strength and the fact that Canadian companies are going to be big players in a lot of international development, business aviation will continue to grow as an input. . . . It facilitates Canadian business, Canadian trade, our economy, and as long as it continues to do that, I see a robust future.”
Barone’s personal vision for that future is to continue the leadership CBAA has developed in areas such as safety management systems. “We have a unique situation here in which the industry is able to play a leadership role in terms of issuing Private Operator Certificates to our members as a regulated third party working with Transport Canada.” At last count, the CBAA had issued 342 POCs and Barone and his board of directors want the organization to become a global centre of excellence in that regard. “It’s something we’re becoming more and more recognized for, especially given the last five years of growth in that program. We have a lot of corporate intelligence that we can show other jurisdictions around the world. We have a mature business aviation community here as well, which gives us strength to move forward.”
A firm believer in the marketplace, Barone cannot countenance reversing the “devolution and deregulation” of the past couple of decades. “Government oversight in Canada is very strong and I think we need to have that in terms of safety. Moreover, our industry understandably is committed to ensuring safe operations. Over-regulation is not the answer because it affects the cost of everything. So we’re always in favour of smart regulation, but needless regulatory burden really facilitates nothing; it doesn’t add value.”
He said that effecting more change is a challenge when the federal government is a minority. Proposed amendments to the 1985 Aeronautics Act, for example, date to June 2000 when the Liberals enjoyed a majority in Parliament. It touched off consultations with the industry and eventually resulted in the introduction of Bill C-6 in the House of Commons in April 2006, early in Prime Minister Stephen Harper’s first minority government. However, that first session of the 39th Parliament ended without the bill being passed, prompting its reintroduction in the second session in October 2007, this time as bill C-7. But that too failed to make it out of the Commons before Parliament was dissolved for last October’s election.
“That kind of legislative or regulatory limbo or volatility is not good for . . . any industry,” Barone said, optimistic that it will be resurrected, hopefully with legislative success this time, early in the new 40th Parliament.
Last, but not least, there’s the ongoing evolution of the Canadian Aviation Regulations (CARs), “a forum at which we’re continually present.” Given his eclectic background, it’s probably no surprise that Barone is “a big fan” of dialogue involving his sector, government and the other stakeholders. “It’s fair to say that you can always streamline the process but it’s definitely something we actively support. Our mandate is derived from CAR 604; it’s a cornerstone mission for us. It’s here to stay.
“In a minority government, the dynamics of that become a little more interesting because how rule-making moves forward is a function of both the regulatory framework and what role parliamentary committees play. I think we’re going to spend more time in that process during a minority situation because consultation becomes even more of a critical path. . . . We support it for the very reason that in one fell swoop you have everyone around the same table. It’s not always conducive to quick agreement, but it is a process that is worth supporting.”