August 14, 2006

Anothr VLJ Story

Sorry, but this could be the next big thing in aviation. ORH needs to be out front on the VLJ's and go after companies like Linear Air:

http://www.domain-b.com/industry/aviation/20060814_vlj.htm

Buoyant global economy, and a overstretched hub-based aviation sector, are seeing the rise of alternative forms of business travel for . The VLJ answers many such needs. With the perennial rivalry between Boeing and Airbus continually grabbing the headlines, the growth of the business aviation sector in general, and the advent of the 'very light jet' (VLJ) in particular, has happened away from the spotlight. It took the launch of auto manufacturer Honda's sleek VLJ, the HondaJet, at the Oskosh air show in the US this year, as well as the type certification of the Eclipse 500, to refocus attention on this business phenomenon.

"What I have in my hand is probably the most significant piece of paper in America today, a piece of paper that will truly change the face of aviation," said US Federal Aviation Adminstration (FAA) administrator Marion Blakey, just before handing the provisional Type Certificate for the Eclipse 500 VLJ aircraft, to Vern Raburn, Eclipse Aviation's president and CEO. Eclipse Aviation Corp will now become the first company in the world to deliver such jets to customers. Eclipse's achievement has been seven years in the making.

Accepting the certificate from Blakey, Eclipse CEO Raburn was no less optimistic: "This sector of the marketplace is attracting more interest, more investment and more activity than any other place in aviation," he said. Eclipse already has nearly 2,500 orders from customers, worth a total of $3.8 billion. With VLJs now set to arrive at airfields around the world in thousands, such numbers are set to alter the face of business travel. The Microjet VLJs or microjets are small planes whose interiors are the size of a minivan's, and are targeted at organisations that want to diversify their corporate fleets, at individual pilots who want to fly their own jets and a budding air-taxi industry that seeks to link small and big airports. Air-taxi services are targeting business travellers who would not like to waste a lot of time shuttling in and out of hub airports. (See: Fractional Jet Ownership)

Most of the VLJs are designed to carry between five to seven passengers along with a pilot, and depending on the load, have a range of between 900-1,400 miles. A VLJ will cost between $1.5 million to $3 million, as compared with corporate jets, whose prices range from $4.5 million to $50 million. VLJs are also less expensive than most of their turboprop competitors. According to Eclipse calculations, a one-way, 400-mile trip on a VLJ, with four passengers on the plane, could cost about $1 a mile per passenger. Some trips could, at most, cost about that of a first-class airline ticket. An identical trip on a corporate jet could cost more than $10 a mile. (See: Business aviation aircraft

1 comment:

Anonymous said...

VLJs _could_ (but are still years off from wide spread ticketed production use) really help but the question is: what are (if any) the landing/liftoff fees paid to ORH? Fuel sales are a plus but wonder if it can cover $3.5M p/y cost. Besides direct airport jobs where's the benefit to local business'?

Once a few planes start using ORH on a regular basis I suspect they'll also want to hire more people and more costs to cover.

Once upon a time ORH was a go idea but that time has past. Does anyone think PVD is just going to stand by as ORH takes it lunch? IMO no way. PVD will underwrite deeply discounted flights until ORH returns to it's "empty shell" status. I suspect they _might_ be friendlier on VLJs but still, if they need the money they'll just take the business.

The City is broke. The pension fund liability is now over $1.5B (yes, billion) and property tax rates are two to three times that of ajoining cities while Worcester's roads are crumbling and schools are closing because of the lack of funds.

Can you please show me anyway ORH could break even in the next three, five and ten years. I can't.

I say close it, sell the property and start turning some revenue from property taxes.

Meanwhile, I plan to move from Worc to Leicester for a lower property tax bill and better schools. Luckly I can do this while most can't.

And ORH is hardly alone. There's bunches of ORH-type airports around the country in the exact same condition.

Make a profit: stay in business. Never even come close to breaking even: close up shop. Works in the business sector.