Global 7500 Boosts Bombardier Q1, but Rocky Q2 Ahead

Acceleration of Global 7500 deliveries helped provide a 5 percent boost in Bombardier’s overall revenues to $3.7 billion in the first quarter, but a “significant” decline in order intake that began in March, coupled with Covid-19-related disruptions, has led the company to evaluate production rate adjustments for the rest of the year, the company reported this morning.

Bombardier delivered 26 business jets in the quarter, including six Global 7500s. Overall, Bombardier delivered two more business jets in the quarter—one additional light jet and another large-cabin jet. The ramp-up in Global 7500 deliveries helped drive a 16 percent increase in business aircraft revenues, the company added.

Bombardier Inc. president and CEO Eric Martel did not provide a specific outlook for the rest of the year, but said he expects the second quarter to mark a low point before gradually improving in the second half. In the second quarter, the company expects a reduction in production, deliveries, “and, therefore, revenues” by almost half, said senior
v-p and CFO John Di Bert. Pointing to analyst estimates of a 30 to 35 percent decline in business jet deliveries this year, Martel said Bombardier might fall into that range as well. 

Bombardier remains in the early stages of assessing production rates to match the rest of the year, but believes the reductions will not affect Global 7500 ramp-up plans.

WingX: Bizav Flight Activity Awakening from Slumber

Global business aviation flight activity continues to recover from its Covid-19-induced slumber, with the moving seven-day average steadily improving 40 percent over the past three weeks, according to data released today by WingX Advance. That average rose from a low of about 3,600 flights per day in mid-April to some 5,200 flights per day as of yesterday.

“This recovery in business aviation activity is far more perceptible than in scheduled airlines,” noted WingX managing director Richard Koe. “Whereas business aviation activity comprised about 15 percent of scheduled sectors at the start of March, it now represents around 33 percent. The North America region is contributing most to the recovery trend in business aviation sectors. Europe is still very flat.”

The lower end of the market—turboprops and light jets—are driving much of the increases, while the upper-end, large-cabin segment has “shown no recovery,” according to Wing X. It said the very light jet segment recorded the strongest recovery trend, and turboprops—mainly the Cessna Caravan, Pilatus PC-12, and Beechcraft King Air 200—are at around 50 percent normal levels.

Globally, business aviation activity was down by 68 percent from April 1 to May 5, WingX data shows.

Preowned Market Remaining Stable Despite Market Roils

Despite the market roils associated with the Covid-19 pandemic, the preowned market—so far—has marked a “stunning contrast” to the financial crash of 2007 and 2008 when a glut of aircraft came up for sale, said business aviation analyst Brian Foley.

Foley, owner of Brian Foley Associates, noted once the market crashed in 2007/2008, the available fleet for sale “quickly ballooned” from the average of between 10 and 12 percent to 18 percent. Now, aircraft owners mostly still appear to be hanging on to their aircraft despite the unpredictable stock markets, he said, citing Amstat figures that the for-sale figure has “blipped up” to just 10.3 percent, compared with 9.8 percent pre-virus.

Foley suggested a number of reasons for this difference, including the fragile financial system that was in place a decade ago bolstered by shaky lending practices and public perception issues surrounding business aviation. This time is markedly different, he said, adding the economy was strong before the pandemic and lending standards are stricter.

Further, those who can afford to fly private will continue, especially given the uncertainties surrounding the pandemic. “For this reason, it’s assumed that the business aviation industry will recover more quickly than the airlines since those traveling on private aircraft will feel safer taking to the skies sooner,” he said.

NBAA Webinar Examines Security in the Covid-19 Era

For those operators still flying during the Covid-19 crisis, the world has changed in terms of security considerations. Charlie LeBlanc, v-p for United Healthcare Global and a member of NBAA’s security council, stressed during an association-hosted webinar yesterday that having the latest information about your destination is more crucial than ever to ensure the safest missions possible.

Internationally, countries have learned they can quickly shut their borders and airspace, and give little notice in many cases. Flight departments should understand a destination country’s past track record and prepare crews and passengers accordingly if a rapid departure is required.

In the U.S., LeBlanc noted that most flight departments have attempted to eliminate overnight stays at destinations, which usually involves earlier departures.

Greg Kulis, also a member of the NBAA security committee, said that with work-from-home plans, coupled with staff reductions, it is now vital to control facility access with fewer people present to watch for security breaches. Companies need to review who monitors alarm systems and security cameras during this period.

“What we would have considered normal activity six months ago is completely turned on its head now,” said NBAA security council chairman Eric Moilanen, adding that it is now common for a person to show up at the entrance wearing a hat, sunglasses, and a face mask.

Bizav Groups Ask Lawmakers for More Industry Assistance

Business aviation groups urged the U.S. Congress to consider additional relief to assist the many business and general aviation businesses and airports that have suffered as a result of the pandemic. “Since early March, general aviation operations have declined more than 70 percent, resulting in severe economic consequences for a variety of businesses, from aircraft operators to airports and aviation manufacturers,” NBAA CEO and president Ed Bolen said in written testimony for a Wednesday Senate Commerce Committee hearing on the state of the aviation industry.

While the recent CARES Act provided some relief, Bolen added, “We believe additional assistance will be necessary. The uncertainty as to the longer-term prospects for aviation requires us to think creatively beyond the Act.” 

NATA president and CEO Timothy Obitts added, “Commercial aviation in the U.S. can only function because it is a part of an interconnected industry that relies heavily on general aviation.” However, he said, much of the aviation support in the CARES Act prioritized the airline industry.

While the CARES Act set aside $10 billion for airports, it designated only $100 million for general aviation facilities, he added. “This led to thousands of general aviation airport sponsors being eligible to receive $30,000 or less under the CARES Act, with many receiving only $1,000, while general aviation airports report declines in activity between 75 percent to over 95 percent.”

MySky Officials Upbeat on Bizav Industry’s Future

Officials from a Switzerland-based provider of technology for optimizing the time and money owners and operators spend on their business aircraft expressed a bullish outlook to AIN this week on the industry’s prospects once the worst of the Covid-19 pandemic has passed. MySky co-founder and global strategy director Christopher Marich said none of his company’s clients are selling their aircraft or canceling their subscriptions to his company’s services. In fact, he said MySky expanded its business 60 percent in the first quarter.

“Although the skies are very quiet right now, I think there’s much less of a panic than we saw in 2008,” Marich said. “We see that people want to keep [business aircraft] and want to keep them ready for when they’re allowed to fly again.”

Marich and MySky head of Americas Jean De Looz said they expect an increase in business aircraft utilization as more corporate department heads seek to put their employees on the company’s business jet instead of on an airliner. And De Looz thinks demand for more corporate flying will cause those companies to look at their fleets and determine if the aircraft they have on hand is sufficient for demand, which could lead to the purchase of additional aircraft. “We’re definitely hearing that from a lot of flight departments that are on our platform,” he added.

NTSB: Wisconsin EMS Crash Followed Loss of Control

The NTSB final report on a fatal late-night rural northern Wisconsin helicopter EMS crash on April 26, 2018, indicates that the pilot was non-responsive before his ship rolled inverted, descended at 5,000 fpm, and hit terrain. The accident sequence lasted 12 seconds. Officially, the NTSB labeled the “defining event” of the crash as “loss of control in flight,” but its report suggests pilot fatigue might have contributed. 

Shortly after the Air Methods 2006 Airbus Helicopters AS350 B2, N127LN, took off on the 160-nm repositioning flight from Madison to a hospital heliport at Woodruff (60WI), the pilot inquired if the two medical crewmembers were “alright back there.” One responded by inquiring if pilot Rico Caruso, 34, was “alright up there?” He answered, “Uh, think so. Good enough to get us home at least.” 

Flight recorder video shows the helicopter entering a progressively accelerating right bank from an altitude of 2,280 feet msl. “The pilot’s body, right forearm, and right hand (which was holding the base of the cyclic grip) appeared to move along with the increased roll rate,” the NTSB said. Audio indicates high rotor rpm warning horn and that the medical crewmembers were unsuccessfully trying to establish verbal contact with the pilot.

AIA Joins Medical Community on Ventilator Portal Launch

The Aerospace Industries Association (AIA) has joined the growing array of aerospace companies assisting in Covid-19 relief efforts, helping to launch a platform designed to connect ventilator companies with component suppliers. Developed with the Advanced Medical Technology Association (AdvaMed), Google, and other industry alliance and partners, the VentConnect portal is designed to help quickly scale ventilator production and distribution, AIA said.

The portal comes as numerous aviation manufacturers and other businesses have turned their attention to ventilator, respirator, and other medical supply production and/or distribution.

“Unprecedented challenges offer unique opportunities to think outside the box, to harness ingenuity and innovation for the greater good, and this partnership is a prime example. Working hand-in-hand, across multiple dynamic industries will not only help meet the increased demand for ventilators, it can also serve as a model for strategic collaboration in the future,” said AIA president and CEO Eric Fanning.

Ventilator manufacturers can sign up on the platform and identify parts and components in short supply. Suppliers can complete an application listing their capacity and materials. While designed to support the immediate need for ventilators and associated devices, AIA said the platform may be used to address challenges surrounding ventilator logistics, distribution, or other needs.