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When 90% is Good Enough

by David Wyndham 1. February 2005 00:00
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Aviation tends to attract perfectionists. At least regarding the aircraft. We take pride in maintaining our heading, altitude and airspeed. And of course, grease a landing with a load of passengers and they'll think your Lindbergh reincarnated. However, when selecting an aircraft for your mission, 100% is probably too good!

There are only two fundamental reasons for acquiring new or different aircraft. Either the current aircraft can no longer perform the mission due to changes in the mission or the aircraft's operating conditions (obsolescence, costs, performance etc) or because the current aircraft is no longer cost effective in terms of the company's required parameters.

As part of your planning for an aircraft acquisition, you need to identify and quantify your real transportation needs. As part of that process, you need to:

  • Differentiate between "must have" and "nice to have" requirements.
  • Identify the aircraft best able to meets the technical requirements.
  • Balance acquisition cost with operating costs for the greatest benefit with the least investment.

It is the last statement that leads me to my 90% is good enough statement. Look at the trips you want your aircraft to do. You'll likely find a wide range of passengers, payloads, and trip lengths. You may also have a variety of airports at different altitudes with different length runways. Don't get locked into finding one aircraft that will do all these trips.

Look at all your missions, including those that you'd like to do, but can't. Then group together like trips in a way that makes sense. See what aircraft are best suited for which trips, and what you need to have to accomplish 70%, 80%, 90% or 100% of those trips.

As an example, lets assume you fly different passenger loads over different trip lengths. Make yourself a table. On the vertical axis of the table, show trip lengths segments. On the horizontal axis, the passenger loads. Plot how many trips there were with how many passengers for each segment. Then differentiate where your particular aircrafts' capabilities lie. Here is one we did for an aircraft needs analysis.

In this case, a small jet was deemed comfortable on 40% of the trips, marginal on 34% and not practical on 26% of the trips. For this operator, the current small jet was not capable on more than one in four trips. We were asked to look at mid-size and large business jets.

A mid-size business jet with eight-passengers and a range of 2500 NM gave them greatly increased capability, but still left them unable to perform the 9 to 11 passenger trips and those longer than 2500 NM. The mid-size business jet left them lacking on about 10% of their trips.

A long-range business jet seated 12 – 13 passengers and had over 3500 NM range. Obviously, our client would be able to do 100% of these trips. But was that the best option?

The mid-size business jet costs $13 million new and had an average operating budget of $1.4 million per year. The large business jet cost $31 million to acquire and $1.9 million per year to operate. On operating costs alone, to enable accomplishing the 10% of the trips that the mid-size jet couldn't do, would cost $500,000 per year if they upgraded all the way to a large business jet.

In this case, the client wound up with a mid-size business jet, and chartered 30 – 35 hours per year in a large business jet when needed. The operating cost savings using the mid-size jet with charter versus using the large jet was about $300,000 per year. This is an example of when 90% is good enough.

Don't get hung up on trying to accomplish everything with one aircraft. Either it won't work, or you'll spend a lot of money to make it work. Other alternatives may be as effective and at a lower cost.

Please feel free to post your ideas and concepts we want to hear from other operators and flight department managers.


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