Judge Allows ‘Unusual’ One Aviation Sale to Proceed
Albuquerque, New Mexico-based One Aviation can proceed with an expedited sale of its assets to a new buyer, U.S. Bankruptcy Court judge Christopher Sontchi ruled yesterday. This effectively shuts out the previous debtor-in-possession and presumed buyer Citiking International US.
On August 28, One Aviation filed an emergency motion asserting the Chinese-backed Citiking lacked the financial resources to take the company out of Chapter 11. In his ruling, Sontchi determined those claims were valid and berated Citiking over its failure to carry out its bankruptcy emergence plan after receiving court approval in September 2019.
Yesterday's ruling allows SEF OA LLC, a recently-created entity backed by real-estate investment firm SE Falcon, to proceed with the purchase of One Aviation’s assets under a Section 363 sale. The decision also injects new funding in the company, staving off threatened closure of its operations next week.
Sontchi cited “very unusual circumstances” in granting the sale request, noting the alternative was to force the one-time manufacturer of the Eclipse 500/550 into Chapter 7 liquidation after laboring nearly two years to emerge from reorganization under Citiking. The judge issued his ruling over an objection from Linda Casey with the Office of the U.S. Trustee, who claimed the sale appeared “not fully baked.” Barring further developments, a final hearing on the sale is scheduled for September 29.
The question so many of us in our industry have asked is how many of those people calling and talking about never traveling commercial again due to Covid-19 will actually translate into people acting on those feelings and fears, rather than just speaking in hyperbole, and buying a private airplane?
In the last two weeks at my aircraft brokerage, we are seeing more first-time buyers. So the talk and conversations are turning into real action. This surge in activity is across the board with respect to aircraft model, from light to large-cabin jets.
Many of my sellers have read articles in the last few months that have predicted this surge of activity. Each one forwarding me the article with a “hold on, look what’s coming” note attached. I do want to caution those sellers of a reality that is accompanying this buying activity. Buyers are not blind to the market conditions, and there is enough inventory to not cause premiums to be discussed or paid.
Buyers are aware of the equipment they are purchasing and understand the nature of depreciation, as well as the overall effect of the pandemic on pricing. As the feelings and fears translate into activity and transactions, I recommend sellers do not miss an opportunity to sell if confronted with a real offer from a real qualified buyer.
EBAA Renews Calls For Transparency in Charter Contracts
Private aircraft charter operators and brokers need to be fully transparent with customers about the terms and conditions for flights to avoid misunderstandings that could undermine consumer confidence, industry experts warned in an EBAA webinar yesterday. In May, the group worked with the Air Charter Association (ACA) to jointly publish “Guidelines and Recommendations For Charter Flight Contracting,” and EBAA is urging member companies to adopt these so as to ensure consistency.
Adam Twidell, co-chair of EBAA’s Associate Members Advisory Council charter brokers committee and founder of charter booking platform PrivateFly, said the Covid-19 pandemic is encouraging new customers to consider charter services and stressed that it is especially important that contract terms are made completely clear to newcomers. He expressed concern that he has seen some flights advertised on an ambiguous basis, implying that in some cases these might not always be offered by genuine commercial operators.
Committee co-chair Mike Ryan, who is managing director of aircraft asset management consultancy Vikingar, said that it hadn’t been easy to get operators and brokers to agree on which terms and conditions should go into the EBAA guidelines.
Avionics services supplier L2 Aviation is expanding into the business aviation market, the Texas company announced this week. L2 has primarily served as a provider of avionics engineering, parts, certification, installation, and manufacturing to commercial, military, cargo, and government aircraft.
With the expansion, L2 plans to offer similar services supporting Gulfstream, Bombardier, Learjet, Embraer, Cessna, and Hawker business aircraft. Based in Dripping Springs, Texas, just west of Austin, the company has routinely provided avionics system upgrades such as ADS-B, FANS, and satcom on Airbus and Boeing aircraft.
The company notes that its remote avionics modification services (RAMS) teams uniquely position it to offer its services to customers who are AOG or prefer to not relocate their airplane for upgrades or repairs. “Our RAMS team members are exceptional with experience that not only includes military and commercial aviation but business aviation as well,” said L2 remote services manager John Farrow. “Adding this category of aircraft to our portfolio makes total sense and provides customers with something that is desperately needed in the industry.”
Faradair Finds Fresh Impetus in New Home for Hybrid
Faradair, the UK company developing a hybrid-electric short takeoff and landing (HeSTOL) aircraft, this week began operations at its new headquarters at Duxford airfield. The move gives the startup the stability needed to advance plans to achieve a first flight with its planned Bio Electric Hybrid Aircraft (BEHA) in early 2024.
The company is the anchor tenant in Duxford’s new Avtech facility established as a research and development hub for general aviation ventures by Cambridge University’s Gonville & Caius College on land that it owns adjoining the Imperial War Museum site. The new facility is expected to be ready in 18 to 24 months and Faradair will use it to build the new aircraft. For the time being, the company is occupying temporary space in the museum’s Battle of Britain hangar.
Design definition work has been underway with a team at Swansea University in Wales for several years. Selecting a partner for the BEHA’s propulsion system is the next critical decision. Faradair anticipates building three variants of the BEHA: the initial hybrid-electric M1H, a pilotless M1AT model to be operated autonomously for military roles, and an all-electric E1 expected to be available by 2030.
This story comes from the new FutureFlight.aero resource developed by AIN to provide objective, independent coverage, and analysis of new aviation technology, including electric aircraft developments.
Connect Skies Broker To Focus on Sustainable Aircraft
Business aircraft and charter flight brokerage veteran Gabriella Somerville is launching a new venture aimed at making environmentally sustainable private aviation more readily available to customers who she believes are increasingly eager to embrace greener modes of transportation. Initially, Connect Skies will focus on sales of existing aircraft that have relatively low carbon emissions and reduced fuel consumption. In the longer term, the company aims to work in partnership with developers of new electric aircraft and so-called advanced air mobility business models.
Connect Skies is now negotiating an agreement to support an undisclosed U.S.-based company that is looking to introduce a new service based on both current fuel-efficient and electric aircraft. The company has expertise in the software needed to support the business model and also in operations, but it is seeking help to select and acquire the right aircraft and develop its new program in Europe.
Somerville, whose Connect Jet charter and aircraft sales business is in the process of merging with Volanteus, told AIN that the business aviation sector needs to be far more proactive in responding to rising demand for more environmentally friendly ways to fly, while also emphasizing the progress that has already been made in this regard.
The FAA awarded another tranche of grants totaling nearly $1.2 billion to 405 airports spread out across all 50 states, along with Micronesia, the Marshall Islands, the Northern Mariana Islands, Puerto Rico, Palau, and the U.S. Virgin Islands. More than $1 billion of the grants come from the Airport Improvement Program (AIP), along with $152 million of the residual funds from the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
“This $1.2 billion federal investment will improve our nation’s airport infrastructure, enhance safety, and strengthen growth in local communities, which is especially important as the economy recovers from Covid-19,” said Transportation Secretary Elaine Chao.
The funds are directed for infrastructure and safety projects such as aircraft rescue and firefighting equipment, runway and taxiway construction and repair, aircraft lighting and signage, airport master plan studies, and airport perimeter fencing.
Awards range by project and, to some extent, the size of airport. Los Angeles International and San Diego International, for instance, were granted $17.5 million and $18 million, respectively, for noise mitigation measures. Meanwhile, New York airports in Le Roy and Ithaca received about $68,000 for taxiway pavement sealing and some $150,000 for navaids, respectively.
Airbus To Begin UH-72B Army Deliveries in 2021
Airbus Helicopters will begin delivery of the UH-72B to the U.S. Army next year, the company announced this week. The updated helicopter replaces the tailrotor on the UH-72A Lakota with a Fenestron and has other features similar to those on the civil H145 variant. Those include more powerful engines, enhanced controls, and the Airbus Helionix avionics suite.
Deliveries of the UH-72B begin with this year’s orders for an additional 17 aircraft under the Army’s light utility helicopter (LUH) program, adding to a contract first awarded in 2006. Airbus has delivered more than 460 UH-72A Lakota helicopters in nine configurations to the U.S. Army, Navy, and National Guard, with the 463rd and final UH-72A model slated for delivery in September.
Airbus manufactures the Lakota at its production facility in Columbus, Mississippi. Over the last 14 years, the Army and National Guard have amassed nearly 800,000 total flight hours on the UH-72A. It is the primary rotary-wing training aircraft for the Army, flies search and rescue, disaster relief, counter-drug, and medevac operations.
Photo of the Week
Former longtime Honeywell Aerospace executive Carl Esposito is keeping his hand in aviation by learning to fly a seaplane in Michigan. Now involved with Lear Corp.’s E-Systems team, Carl took some time off to capture this photo after his first lesson and said he was “really hooked after that experience.” We’re hooked, too, Carl. Thanks for sharing.
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