Business Aviation & NextGen, Part II: Upgrade, Sell, or Do Nothing?


Image: Creative Commons/SempreVoldano

For aircraft owners, there are still a lot of issues surrounding the FAA's NextGen program. Determining what you should do to remain compliant without drowning in the high costs associated with the new avionics involved is challenging, to say the least.

Last month, in part one of our NextGen series, I discussed avionics equipment and mandates associated with the NextGen program, including what equipment is already mandated, what will be mandated come 2020 and what could potentially become required in the future. These scheduled and proposed mandates have become an important factor to consider for aircraft owners, especially when it comes to deciding whether to upgrade their aircraft's avionics or upgrade to a new airplane altogether.

Here's a rundown of what some aircraft owners have experienced, including how much cash you may need to shell out to get up to speed:

The Trends:
While some business jet operators have a little bit of time to think it over, others are already finding it necessary to upgrade their airplanes to ADS-B and FANS-1/A for international operations. And others are choosing to upgrade early to get it over with and avoid the consequences of not being ready for the 2020 ADS-B mandate.

"What I'm seeing is people using the cost of NextGen to justify an aircraft replacement sooner rather than waiting," says David Wyndham, President and Co-Owner of aircraft consulting firm Conklin & de Decker. "They are fearful of the cost of the upgrade on their older aircraft, or having an older aircraft with little resale appeal if they don't upgrade."

The resale value of an old airplane is one thing. The cost of new, mandated equipment exceeding the cost of the aircraft itself is another reality that aircraft owners must face.

But not everyone shares the opinion that upgrading now is the best option. Some aircraft owners are willing to wait it out with the preconception that the FAA won't be able to meet its own mandate in 2020, and with the hope that the cost of equipment will decrease as more manufacturers put their solutions on the market and better options start to emerge than exist right now. This plan could backfire, though: According to Duncan Aviation's website, as the deadline approaches, the cost of ADS-B will likely go up and aircraft owners could find themselves on a wait list for installation, and, ultimately, grounded.

The Challenges:
Equipment upgrades for NextGen have become a bit of a headache for aircraft owners, as much of the newer technology isn't compatible with what's currently on board aircraft, especially aircraft older than 10 years.

Jeremy Cox, Vice President of JetBrokers, Inc says there are problems at the manufacturer level when it comes to compatibility. "The main problem with ADS-B compliance…is that both Collins and Honeywell are still working on their FMS modifications to enable the ADS-B functionality."

"Worse, there will not be any weather depiction through most of the large aircraft FMS units, as they will not support the frequency," Cox says.

Add to this the possibility of STCs and required waivers for some equipment upgrades, and aircraft owners are experiences delays and down time for expensive equipment that they didn't want to begin with.

The Real Cost:
There are numerous options to consider when it comes to upgrading an airplane for NextGen, which is why every aircraft will be different when it comes to determining the cost of NextGen upgrades.

International operators will be hit the hardest, according to Cox. A full NextGen-compliant upgrade for an international, long-range business jet could likely mean numerous equipment upgrades, such as a new GPS, NAV system, FMS, transponder, Multi-Function Display (MFD), SATCOM, cockpit voice recorder (CVR), or a datalink printer.

Some owners will have additional options to consider, like whether to install ADS-B In along with ADS-B Out equipment. (As of now, the FAA is only mandating the use of ADS-B Out.)

Cox says the cost could add up to millions for business jet owners. "A Gulfstream IV will cost about $1 million to comply. A Falcon 900 will cost anywhere from $1.1 million to $3.5 million. A Challenger 601 will cost more than $1.5 million. Add to this the cost of in-flight SATCOM data that will always be turned on when operating within FANS and CDPLC airspace."

The Silver Lining:
If there's a silver lining to the cost of NextGen equipment, it's that the safety and efficiency that comes with these upgrades will benefit everyone who participates.

While the initial installation is no doubt costly, some people (depending on the type of ADS-B equipment used) will get satellite weather and traffic information at no cost. For those used to paying fees for satellite weather and GPS subscriptions, the high initial price of ADS-B might be worth it in the long run.

And still others see the value in NextGen overall. Pilots are all different when it comes to what they find necessary or valuable in avionics, and many see ADS-B and other equipment upgrades as a welcome and necessary part of the flying world.

Aircraft owner Neal Clayton says the technology is worth it. "I am not a weekend-afternoon local flyer. If I fly I'm going somewhere, at least across state lines, maybe at night, maybe in IMC, or maybe both. So things like synthetic terrain, weather display, and GPS steering are more than toys to me."