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The Case for FAIR User Fees

by David Wyndham 28. November 2011 15:42
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Before I get a lump of coal in my stocking delivered by SantaAir, let me stress the word Fair! User Fees as recently proposed would have a negative affect on our industry and perhaps even on safety. Here are some major financial issues we face in aviation:

 

1. On November 17, Congress approved a minibus appropriations measure which funded DOT and FAA for FY 2012. Bad news with that is the AIP gets a $165 million reduction in funding. Less money for airport improvements.

 

2.  A few days later, the Congressional “Super Committee” failed to reach an agreement on funding and deficit reduction, triggering an automatic $1.2 trillion in spending cuts. Of course those mandated automatic cuts will be changed, but cuts are still coming and how will aviation fare? NextGen needs funding to continue, our airports are in need of updates and improvements, ATC may see reductions in controllers and control towers, and the FAA may not be able to replace 600 safety and certification inspectors lost through attrition.

 

3.  The TSA, its 65,000 employees and $600 billion over 10 years is competing for the same dollars. Cuts in the TSA budget may force further security expenditures by airports and local communities. 

 

So we in aviation are seeing cuts in critical programs, a delay or decline in airport improvements, and the FAA can still be held hostage over non-aviation issues. We have little control over all of that.

 

What if we had the FAA as an independent agency, self-funded and with a Board of Directors with General Aviation representation? What if this agency was able to (within limits) control its own budget?  The current FAA funding is not working. Just adding fees on top of a broken funding system will not work either. 

 

I know using the Post Office is maybe not the best example, but they are independent. Take the lessons learned and lets get the FAA set free from DOT. An FAA Board of Directors should have participation from all forms of aviation, airlines and General Aviation. If that could happen, then some form of user-funding with user-participation could work. It may mean a significant increase in fuel taxes along with some new fees, but GA having a formal seat (or seats) at the “table” would be worth it. BARR could be permanently barred. The FAA could get back to part of its original mandate to “promote and regulate” aviation. 

 

For User Fees to work for aviation, first the FAA must be independent and overseen by those with a stake in the venture. Doubtful, but you never know what can happen.


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David Wyndham

Globalair.com signs petition for opposition of the proposed FAA's announcement that it will begin charging for NOS chart downloads

by GlobalAir.com 17. November 2011 15:47
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Globalair.com has learned that the FAA is planning on charging for NOS chart downloads and has joined the petition to oppose this new infringement on the aviation industry.  "IMC Club International Inc. President Radek R. Wyrzykowski was the first to sign the petition.  In a press release on November 15th Mr. Radek comments, "During these tough financial times, where student pilot enrollments are already drastically reduced, one has to ask the simple question - How many flight instructors, students and pilots will have extra funds to cover additional expenses? Pilot safety is at risk. Forcing the General Aviation community, the very backbone of aviation safety, to incur additional expenses will surely lead to less proficiency, poorly educated pilots and will drastically compromise the safety of aviation. IMC Club International Inc. strongly opposes charging fees to companies for government airport and approach data downloads while no longer allowing individuals access to them without incurring substantial fees.”

“IMC Club International Inc. strongly opposes the FAA's announcement that it will begin charging for NOS chart downloads that were previously free. The new policy will start beginning April 5, 2012. This means charging fees to companies for downloads and no longer allowing individuals to access them at all. As of April 5, only those with distribution contracts with Aeronav will be able to download the data. This action will put a severe financial burden on flight instructors, pilots and students. It will affect small aviation safety material distribution companies like ForeFlight. Only large aviation corporations will be able to offset these expenses.  This policy will have serious and wide ranging implications for the general aviation economy as it will restrict access to basic safety and proficiency materials.

Besides its immediate impact on aviation safety, this FAA action will set a sad and dangerous precedent for the future of aviation in the United States. It will open the door to imposing future additional charges such as weather briefings, calls to ATC while enroute, and formerly free usage of the ATC system.




An online petition has been created at “We the People” to gather support against the new Federal Aviation Administration’s policy.  If the petition receives 25,000 "signatures" by December 14, White House staff will review it, ensure that it’s sent to the appropriate policy experts, and issue an official response.

For more information and to view and sign this petition:
http://wh.gov/jCZ

Globalair.com would like to urge all persons involved with the aviation industry to seriously consider signing the petition as it effects each and everyone of us.  This is another clear example of our government not thoroughly investigating the entire picture and how it effects more than a few pilots as clearly stated in Mr. Wyrzykowski comments.

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GlobalAir.com

Cirrus reports growth despite uncertain economy

by GlobalAir.com 9. November 2011 16:59
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Cirrus reports growth despite uncertain economy

By Dan Namowitz of AOPA

Cirrus Aircraft reported increased production during the third quarter in an announcement that differentiated company performance from overall industry statistics showing a slowing rate of decline in aircraft deliveries

During the third quarter, Cirrus completed 68 new aircraft, seven more than during the third quarter of 2010, said Todd Simmons, vice president of sales and marketing. Although only 48 deliveries were reflected in the third-quarter industry report released by the General Aviation Manufacturers Association, "an additional 20 aircraft were completed in Duluth, Minn., and are currently in transit to the Civil Aviation Flight University of China (CAFUC) in Luoyang, China," Cirrus said in a news release.

Cirrus cited market-share statistics and strengthening revenue as highlights of the reporting period, pointing to a 37-percent share of the single-engine piston, tricycle-gear, certified aircraft sector versus 32 percent for its closest competitor (which according to GAMA figures appears to be Cessna), and a 77-percent share of the high-performance four-seat airplane market. Average revenue per aircraft increased 20 percent over the 2010 third quarter, Cirrus said.

Cirrus also noted nonfinancial milestones that occurred during the period.

The company delivered its tenth and final Limited Commemorative Edition SR22T, a model developed to recognize the anniversary of the first SR22 delivery in 2001. Another landmark event occurred at AOPA Aviation Summit in Hartford, Conn., in September, when Cirrus delivered its 5,000th SR-Series airplane—a production achievement the company heralded as "an astounding accomplishment in aviation" because it occurred in "just over a decade."

Simmons ventured a cautious outlook for the industry, but also optimistic, "especially when you add in the most generous tax incentives ever for U.S. customers."

"At the same time, we are still facing the challenge of a stubbornly slow recovery in the traditional North American and European general aviation markets, and currency fluctuations and economic uncertainty remain present in so many countries around the world," the company said.

On the research and development front, Cirrus reported steady progress on the Cirrus Vision SF50 personal jet program, noting that "exciting program announcements are just ahead."

Cutter Aviation, Southwest U.S. Dealer for Quest KODIAK, to Deliver First KODIAK in December

by GlobalAir.com 3. November 2011 12:41
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FOR IMMEDIATE RELEASE

November 3, 2011

 

Cutter Aviation, Southwest U.S. Dealer for Quest KODIAK, to Deliver First KODIAK in December
Cutter Aviation Aircraft Sales, the Authorized Dealer for Quest KODIAK in Texas, New Mexico, Arizona, S. Nevada and S. California will take delivery of KODIAK, s/n 100-0061 in December

 

PHOENIX, AZ. — Cutter Aviation is happy to announce that it will be accepting and delivering the first Quest KODIAK for the Southwestern U.S. dealer territory from Quest Aircraft Company in December 2011.  Cutter Aviation Aircraft Sales was announced as the Authorized New Aircraft Dealer for Quest KODIAK for the Southwest U.S. in August 2011 at EAA AirVenture by Quest Aircraft Company. Cutter Aviation Aircraft Sales is excited to bring KODIAK s/n 100-0061 to the region and demonstrate the KODIAK’s modern, rugged and powerful STOL capabilities while carrying high useful loads to every runway from modern urban airports to remote backcountry airstrips.

 

Powered by the reliable Pratt & Whitney PT6A-34 turboprop engine, the Quest KODIAK can take off in under 1,000 feet at full gross weight and climb at over 1,300 feet per minute.  Configured for straight cargo or up to 10-seat in a passenger layout, the KODIAK features the latest Garmin G1000 flightdeck and can easily handle unimproved airstrips.  Additionally the KODIAK is configurable for water operations with floats or amphibs without structural upgrades as the airframe was designed for such operations originally.

 

“The Quest KODIAK is truly a perfect aircraft for owners and operators in the Southwest United States” said R.D. Wooten, Regional Quest KODIAK Sales Manager for Cutter Aviation Aircraft Sales. “The vast stretches of sparsely populated and rugged landscape in Texas, New Mexico, Arizona, Nevada and California requires a flexible utility aircraft like the KODIAK to get the job done.”

 

Wooten adds, “Combine it with the challenging terrain and the number of remote ranches, drilling and mining operations, outposts and even communities in the region that are only easily accessible by air and it’s easy to see why the KODIAK fits the needs of our customers in the Southwest.”

 

The Quest KODIAK s/n 100-0061 being delivered in December by Cutter Aircraft Sales will feature premium options such as the larger 29” Tire upgrade package, four additional Timberline passenger seats, air conditioning and the Garmin GDL 69A-XM Data Link with Audio Infotainment package to give it the utmost utility capabilities for customers within the Southwest.

 

Cutter Aviation Aircraft Sales is an Authorized New Aircraft Dealer for Quest Aircraft Company and represents Quest KODIAK in Texas, New Mexico, Arizona, Southern Nevada (Clark County) and Southern and Central California (following counties: Fresno, Imperial, Inyo, Kern, Kings, Los Angeles, Madera, Mariposa, Merced, Mono, Orange, Riverside, San Bernardino, San Diego, San Joaquin, San Luis Obispo, Santa Barbara, Stanislaus, Tulare, Tuolumne, Ventura).  For more information on Cutter Aviation Quest KODIAK Aircraft Sales, please visit: http://www.cutteraircraftsales.com/Quest-KODIAK.

 

About Cutter Aviation

Founded in 1928 by William P. Cutter, Cutter Aviation is a full-service aviation company, offering aircraft fuel/line services, maintenance and avionics solutions, aircraft charter and aircraft sales and management. Cutter Aviation operates from eight major airports in five states within the Southwestern United States including: Arizona (Phoenix-Deer Valley and Phoenix-Sky Harbor), New Mexico (Albuquerque), Colorado (Colorado Springs), California (Carlsbad) and Texas (Dallas-McKinney, El Paso and San Antonio). The company is a member of the Pinnacle Air Network, National Business Aviation Association (NBAA), and the National Air Transportation Association (NATA). Cutter Aviation is the oldest continuously family-owned and operated FBO (Fixed Base Operator) in the United States with over 83 years of serving the General & Business Aviation industry. For more information about Cutter Aviation, please visit www.cutteraviation.com

Last Quarter 2011 Market Condition Report

by Jeremy Cox 1. November 2011 13:32
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LAST QUARTER 2011 MARKET CONDITION REPORT

Globalair Article – November 2011 By Jeremy R.C. Cox

In March 2009 I wrote an article for Globalair.com that was Titled: ”The Not So Great Depression”,
you can re-read this by clicking on this link:
http://blog.globalair.com/post/The-Not-So-Great-Depression.aspx

I wrote that piece whilst we were all living under the developing fall-out that was created as a
direct result of the Global Financial Crisis (GFC) that was first felt in the late summer of the previous
year, and was later proved to have started a full year before then (2007.)

The purpose of this article is to attempt to track just how far the Used Business Aircraft Market has
managed to pull itself away from the stinging clutches of GFC. I will use a statistical analysis process
that is fuelled by the numbers available to me through my subscription to AMSTAT. I will let you draw
your own conclusion as to where we currently stand overall, however it would be remiss of me if I didn’t
state that I believe that the Used Business Aircraft Market is on-track to achieve a soon to be issued
clean bill of health.

 

IT IS ALL IN THE NUMBERS, I.E. THE ‘PERCENTAGE FOR SALE’

November 2005 – Baseline

10,207 Turbo-Props, 1,127 or 11.04% were available for Sale

5,757 Light Jets, 833 or 14.47% were available for Sale

4,967 Medium Jets, 544 or 10.95% were available for Sale

3,180 Large Jets, 279 or 8.77% were available for Sale

 

November 2007 – Pre GFC Effect

11,121 Turbo-Props, 928 or 8.34% were available for Sale

6,417 Light Jets, 812 or 12.65% were available for Sale

5,757 Medium Jets, 584 or 10.14% were available for Sale

3,728 Large Jets, 267 or 7.16% were available for Sale

 

November 2009 – Within The Depths of GFC

12,049 Turbo-Props, 1,503 or 12.47% were available for Sale

7,285 Light Jets, 1,313 or 18.02% were available for Sale

6,568 Medium Jets, 1,098 or 16.72% were available for Sale

4,233 Large Jets, 597 or 14.10% were available for Sale

 

November 2011 – Emerging From GFC

12,616 Turbo-Props, 1,350 or 10.70% were available for Sale

7,615 Light Jets, 1,198 or 15.73% were available for Sale

6,826 Medium Jets, 924 or 13.54% were available for Sale

4,612 Large Jets, 554 or 12.01% were available for Sale

SUMMARY GRAPH SHOWING HISTORICAL TO CURRENT PERCENTAGE FOR SALE

 

As you can see from the numbers and the associated Graph, the Percentage-for-sale ‘Peak’ came
approximately
in 2009 (Light Jets peaked at 18% Mid 2009, while the rest all peaked in late 2009.)
We are about halfway back
to normal therefore 2012/2013 are looking like they might be ‘rock-solid.’

 

THE TIME IT TAKES TO SELL IN TOUGH TIMES

 

How long does it take to sell an Aircraft? Statistically for the same Groups, one can track the Number of
Days
On Market, i.e. the Average calendar time period in days from Initial Listing For Sale until Deal Closing.
The numbers are as follows:

November 2005 – Baseline

Average Days On Market for all Turbo-Props was 505

Average Days On Market for all Light Jets was 498

Average Days On Market for all Medium Jets was 436

Average Days On Market for all Large Jets was 447

 

November 2007 – Pre GFC Effect

Average Days On Market for all Turbo-Props was 492

Average Days On Market for all Light Jets was 517

Average Days On Market for all Medium Jets was 382

Average Days On Market for all Large Jets was 409

 

November 2009 – Within The Depths of GFC

Average Days On Market for all Turbo-Props was 420

Average Days On Market for all Light Jets was 471

Average Days On Market for all Medium Jets was 357

Average Days On Market for all Large Jets was 376

 

November 2011 – Emerging From GFC

Average Days On Market for all Turbo-Props was 553

Average Days On Market for all Light Jets was 588

Average Days On Market for all Medium Jets was 471

Average Days On Market for all Large Jets was 459

SUMMARY GRAPH SHOWING AVERAGE DAYS ON MARKET

 

 

What is really interesting about this graph is the fact that when an Aircraft MUST be sold ASAP, it is
‘Right-Priced’ and sold in less time than normal. The Lowest number of Days occurred immediately after
GFC showed it despicable face to us all.

Now for the Same Aircraft Groups we shall focus on the Average Year of Manufacture for each Group:

 

AGE AFFECTS POPULARITY

November 2005 – Baseline

Average For-Sale Year of Manufacture for all Turbo-Props was 1982

Average For-Sale Year of Manufacture for all Light Jets was 1983

Average For-Sale Year of Manufacture for all Medium Jets was 1985

Average For-Sale Year of Manufacture for all Large Jets was 1982

 

November 2007 – Pre GFC Effect

Average For-Sale Year of Manufacture for all Turbo-Props was 1984

Average For-Sale Year of Manufacture for all Light Jets was 1985

Average For-Sale Year of Manufacture for all Medium Jets was 1988

Average For-Sale Year of Manufacture for all Large Jets was 1985

 

November 2009 – Within The Depths of GFC

Average For-Sale Year of Manufacture for all Turbo-Props was 1987

Average For-Sale Year of Manufacture for all Light Jets was 1989

Average For-Sale Year of Manufacture for all Medium Jets was 1992

Average For-Sale Year of Manufacture for all Large Jets was 1992

 

November 2011 – Emerging From GFC

Average For-Sale Year of Manufacture for all Turbo-Props is 1988

Average For-Sale Year of Manufacture for all Light Jets is 1990

Average For-Sale Year of Manufacture for all Medium Jets is 1992

AVERAGE AGES OF FOR SALE AIRCRAFT ARE GETTING YOUNGER, AS THE FLEET AGES

 

 

SPECIFIC MODELS

 

The following figures are quite enlightening as to the issue of Age and Obsolescence:

 

Year of Manufacture

1985

1981

1976

1978

1983

1979

 

MU2 Solitare

Merlin IIIB

Learjet 25B

Sabreliner 75A

Challenger 600

Gulfstream II

 

 $1,375,000.00

 $1,795,000.00

 $1,297,500.00

 $2,990,000.00

 $9,000,000.00

 $7,775,000.00

Year of Analysis

MU2 Solitare

Merlin IIIB

Learjet 25B

Sabreliner 75A

Challenger 600

Gulfstream II

Nov-05

 $900,600.

 $ 828,800.

 $645,000.

 $683,000.

 $4,395,000.

 $ 2,912,692.

Nov-06

 $910,727.

 $767,475.

 $715,833.

 $513,333.

 $5,412,857.

 $3,007,333.

Nov-07

 $834,800.

 $883,494.

 $590,000.

 $629,000.

 $5,297,222.

 $2,696,000.

Dec-08

 $891,500.

 $963,132.

 $520,625.

 $825,000.

 $4,626,667.

 $2,171,574.

Nov-09

 $841,128.

 $930,000.

 $648,875.

 $666,666.

 $2,815,594.

 $908,890.

Dec-10

 $824,480.

 $706,600.

 $496,642.

 $499,900.

 $2,163,333.

 $819,928.

Nov-11

 $728,800.

 $717,750.

 $485,500.

 $350,000.

 $1,665,625.

 $826,691.

OBSELETE AIRCRAFT (BASED UPON VALUES)

Year of Manufacture

2002

2005

2003

2000

2001

1999

 

Socata TBM700B

King Air 350

Cessna CJ1

Hawker 800XP

Challenger 604

Gulfstream V

 

 $2,512,390.

 $5,881,474.

 $4,024,000.

 $11,895,000.

 $23,235,000.

 $39,100,000.

Year of Analysis

Socata TBM700B

King Air 350

Cessna CJ1

Hawker 800XP

Challenger 604

Gulfstream V

Nov-05

 $2,071,153.

 $2,651,666.

 $3,554,500.

 $10,208,000.

 $18,500,000.

 $36,573,333.

Nov-06

 $1,905,833.

 $3,658,333.

 $3,374,500.

 $9,768,000.

 $18,700,000.

 $33,950,000.

Nov-07

 $1,850,000.

 $4,211,923.

 $3,610,000.

 $9,158,214.

 $22,315,000.

 $45,000,000.

Dec-08

 $1,859,875.

 $3,633,947.

 $3,552,222.

 $8,918,700.

 $20,675,000.

 $38,683,333.

Nov-09

 $1,685,556.

 $3,594,565.

 $2,944,750.

 $5,852,250.

 $13,140,455.

 $25,185,714.

Dec-10

 $1,634,989.

 $2,941,500.

 $2,641,500.

 $4,610,313.

 $13,289,000.

 $26,247,500.

Nov-11

 $1,587,857.

 $3,034,211.

 $2,299,087.

 $4,080,909.

 $11,356,250.

 $26,400,000.

CURRENT OR NEAR CURRENT PRODUCTION AIRCRAFT

With all that said I believe you can see that the market is progressing and should you be condsidering
the next step please review
Globalair.com - Aircraft Exchange.  Very current with aircraft, tools to use
such as A.Buyer and comparison tool.  If you are thinking it you might want to use Globalair.com.

See you next Month!

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Jeremy Cox | Aircraft For Sale



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