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Waypoint: Where are we?

The business aviation sector appears to be bouncing back after a few rough years. Ramps are busy and hangar space is definitely at a premium but there are few signs of expansion or new facilities due to two key factors that could prove to be major hurdles in the years ahead: restricted land available at many airports for general aviation and BizAv and the operators’ need to see a sustained level of business to warrant any expansion.

Some secondary airports have taken advantage of government funding for infrastructure improvements in recent years and in the process created new sites for development. PHOTO: Embraer

Demand will change sooner than later, but land use is going to be an ongoing and growing battle at key or hub airports. Fuel prices seem to have levelled and in fact dropped a bit – a trend projected to continue. That is good news as lower prices always encourage more activity.

Generally the FBO and aircraft support side of the market is doing better, with room for more growth and, according to many leading operators across the country, is looking for sustained business signals to expand. On the down side, airport access and availability is still a concern. Case in point: the closure of the Edmonton Municipal Airport and the pending closure of the Toronto Buttonville Municipal Airport in the next few years. Just replacing these airports and their capacity will mean extensive spending and developing new sites after land has been procured. Given environmental restrictions and government oversight, the prevailing “not in my backyard” attitude of many municipalities and the lack of government-driven funding, creating new airfields is no small task.

It requires deep pockets and significant commitment to servicing aviation as a business. 

Some secondary airports have taken advantage of government funding for infrastructure improvements in recent years and in the process created new sites for development. In Ontario for example, Peterborough, the Region of Waterloo International Airport and Lake Simcoe Regional Airport are three such airfields with the “welcome” mat out. The issue in many cases, however, is convincing aircraft

owners and operators that these are good places to locate their aircraft for the extra road time.

The numbers don’t lie – Pearson is basically full, Toronto Island is likewise full or restricted by runway length and noise management. Oshawa has runway issues for larger business jets and other airfields are underdeveloped, crowded or just not able to handle the business. That extra drive to Peterborough, Barrie or Kitchener is one very real consideration, but the owners and operators are not there yet. This story is repeated across Canada as airports face increased operational support costs, redevelopment and expansion concerns and the government remains out of the ownership business.

Looking more closely at the bizjet market, in February, Forecast International predicted that global business jet production will total 761 aircraft in 2013. Put this into perspective: Canada is at best no more than five to seven per cent of this total. That is no more than 54 aircraft. A bit high perhaps? 

At any rate, regardless if it is Forecast, Brian Foley or any of the other “predictors,” all seem to agree that 2013 marks the start of a recovery in annual business jet build rates that will extend at least through 2019. The used inventory of aircraft is slowly coming down and overall use through private/owner flights, charter and fractional are generally on the rise.

Domestically it is certainly not a bad time to be building aircraft if your name is Bombardier. A recent $7.8-billion order from VistaJet, a Swiss entity, for a top-end, all-Bombardier fleet, coupled with the business the company already had in hand means a busy shop and high demand from those in its supply chain.

On the not-so-great side, Diamond unfortunately announced that its much-anticipated D-Jet is back into “hold” and the staff who were working on it laid off. This is sad news for an aircraft that had potential to take piston and turboprop owner/operator types into the jet age. That particular market still has of course the venerable Cessna Mustang and Embraer Phenom 100 along with a resurgent Eclipse, but look out – Honda Jet is about to arrive too. Skyservice Business Aviation has been appointed as sales and service rep for what many have predicated will be the “Civic” of the skies – a quality, reliable and very well-thought-out and tested mode of transport.

So where are we? I think it is a case of doing OK. There are some challenges, some good things to come and some possibility for either growth or retraction depending on outside influences. As I always say, the greatest thing about working in aviation is that it changes all the time – for better or worse.

Rob Seaman is a Wings writer and columnist.