May 31, 2012
By Dan Namowitz
Aviation groups said a newly released report on the state of the business aircraft industry highlights challenges facing the sector and confirms the “critical importance” of aircraft manufacturing to the nation’s industrial base.
The National Business Aviation Association (NBAA) and the General Aviation Manufacturers Association (GAMA) issued statements after the U.S. International Trade Commission released its new report “Business Jet Aircraft Industry: Structure and Factors Affecting Competitiveness .”
The study arose from a May 23, 2011, request by the House Ways and Means Committee for the USITC to examine industry competitiveness. It analyzed market conditions from 2006 to 2011 for business jets weighing 50,000 pounds or less, and examined the global business aircraft market, government policies, financing, and factors affecting future global competiveness.
The report found that the U.S. business jet industry was “severely hit” by the global economic downturn, with light and very light jets being the hardest-hit market segments. Those are also the segments in which domestic producers are most active, it said.
Describing “an uncertain investment environment for producers and purchasers,” the study predicted that export credit agencies, especially those in the United States, Canada, and Brazil, would likely play an increasing role in funding jet export sales.
It noted possible opportunities for the industry’s “six principal producers” in the opening of airspace in China, and the potential threat of proposed aviation user fees in the United States.
“This new report underscores the fact that business aviation is an essential industry, strengthening America’s manufacturing base, fostering economic development and serving as an indispensable tool for thousands of companies trying to operate in a fiercely competitive global marketplace,” said NBAA President and CEO Ed Bolen, who testified in September 2011 before the USITC.
“We hope the study serves as a reminder to Congress and the Administration that government actions can directly impact the future of this great industry, and that policymakers will advance proposals that promote business aviation instead of impeding it,” he said in a news release.
Pete Bunce, president and CEO of GAMA, said the report comes at a time when “general aviation manufacturers around the world are collectively suffering through one of the worst economic downturns the industry has ever experienced.”
The document “usefully highlights a number of key factors impacting the industry, including the slow economic recovery in the largest markets--North America and Europe--as well as tight financing, the threat of new taxes and fees, and delays in certification which impact manufacturers’ ability to bring new, safety-enhancing technologies to market in a timely manner,” he said in a statement on GAMA’s website.
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