Is Airline Withdrawal a GA Opportunity?
By Scott Spangler on May 19th, 2014
A recent New York Times story, “Air Travel Economics Make Midsize Hubs Unprofitable”, explained why airline travel today often demands long drives to the nearest major airline hub. This withdrawal of service from outlying communities and hubs makes perfect profit-and-loss sense for the airlines, and it poses an antipodal crisis for the companies whose employees must travel on business, who used to be, it seems, a highly desirable airline customer.
This situation should be fertile ground for the creation of a company flight department, a step many companies of a certain size took long ago. But I wonder if now might be the time for a different kind of flight department, where the employees needing transportation fly themselves in a Cirrus or Cessna. If the employee had the desire, why shouldn’t the company provide his or her training? Wouldn’t this be a win-win for both parties?
Safety would and should be the primary concern and it could be easily managed, I think. Instead of chauffeuring employees, the fly-yourself flight department pilots would provide the initial and recurrent training to the employees who fly themselves. (Naturally, companies that fly jets and other complex airplanes would employ pilot whose job is to fly them.)
The flight department would also handle the traditional duties as well, including dispatch, maintenance, and record keeping. And one of the flight department pilots would always be available by phone for a decision-making discussion with an employee pilot facing possibly perilous situations defined by the company flight operations manual.
Beside saving time wasted driving to some distant airline hub, the fly-yourself flight department might also be an excellent perk that would help a company recruit new talent. And it would help that talent decide between two offers. And the the company should be able to take advantage of depreciation on the fly-yourself fleet and other possible deductions.
This is not a transportation panacea for all companies, but it would be a small contribution to the survival of general aviation and the infrastructure that supports it. But the era of mass market fixes for big problems is long gone. In the today’s realm of niche marketing, it will take a number of small fixes, like fly-yourself flight departments, to address bigger problems. – Scott Spangler, Editor
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May 20th, 2014 at 3:19 pm
Good theory Scott, but very short on practicality,
most companies will be money ahead to move to areas served by air carriers, especially considering the continuing and accelerating downfall of GA and GA related services and the disproportionate increase in the total cost of aircraft operation,
May 20th, 2014 at 3:59 pm
Crash that Cirrus into a school bus and the lawsuits will wipe out the company. Aircraft insurance generally won’t provide a high enough liability limit for owner-flown single-engine aircraft, or at least not at a reasonable rate.
May 20th, 2014 at 4:49 pm
Scott –
Nice idea but I expect the liability exposure will be too much for most companies with significant assets. The company I work for operates a biz jet and already has a flight department. A few years ago we proposed a program very similar to the idea you described. It would have allowed certain pilot-employees to fly on company biz subject to initial qualification & training by our chief pilot and with ongoing mission oversight by the flight department. Our insurance carrier not only said “no” to covering these operations, they backed up their refusal with a threat to double our corporate umbrella policy premiums (covering the jet and other assets) if the company went ahead with the plan on its own. Bottom line: Unless and until insurance companies are willing to provide affordable coverage, your idea will be DOA in most board rooms.
May 20th, 2014 at 6:05 pm
I like the idea of a mallet company having a cessna or cirrus for their flight department. I do not like the idea of people flying themselves. This is way too risky. Would you have a part-time CEO or part-time director of marketing? Management would say, no, they are too complex. Same said for the pilot.
May 20th, 2014 at 7:10 pm
Scott,
You’re on to something here, despite the naysayers below. You must solve three problems: (1) safety- It’s not a good idea to have Cirrus’s parachuting to earth. Automate the whole thing and eliminate the pilot. (2) Ease of use – Automate! See above. (3) Accessibility – Sole use doesn’t make sense unless you fly 150+ hours per year. We need time share schemes. NOTE: All of this may offend the GA traditionalists, but it’s the only way for GA to survive.
May 20th, 2014 at 7:41 pm
Scott, sounds good,(love GA,) but wouldn’t that be impractical? Stop and think of the traffic buildup at those airports. Then there is the problem with the insurance companies, the bane of all aviation, as well as “pilot duty hours.” As you said though, the first step is always a small one, and a walk starts with that first step.
May 20th, 2014 at 8:42 pm
Scott,
Great idea, but we do have a problem with insurance companies. In my own situation, I agreed to work at a rural outpost of a big city group, with the express provision that I could use my own aircraft to travel to/from the big city functions (3+ hours driving v. 40 minutes in my C182). Otherwise the job was a non-starter.
All went well for 5 years, then the workers-compensation (of all things) company told them they would not cover me with workers comp policies on private flights as crew.
I could get the coverage on my aircraft they wanted, but they wanted a $10M liability limit. My $1M smooth policy costs me about $500/year as I am high time, and used to fly freight, but if I wanted the $10M, the premium jumps to $8k, and includes a 6 month proficiency requirement at FSI/equiv. Not that I am opposed, but that too costs time and money. I could get and maintain a Pt 135 policy cheaper than that, that would meet the feds requirements, but they wouldn’t agree to the Part 135 extra maintenance costs.
It is still cheaper for the company to pay those costs, as per our agreements I won’t give up the flexibility of flying “GA style” which means all tickets are refundable/changeable, I go when I want, and if I need to go somewhere tomorrow I walk up the counter and buy a ticket on the next flight. Their travel costs went from a couple of hundred for avgas in the C182 to over $14k including the needless overnights the first year, and I’m wondering what they’re going to do next year.
So, even if there is commuter service where you are, it is still potentially cheaper to use GA if you need the flexibility to go now, because something came up over there. That’s the case you want to make to industry, but you can’t do it with dufusses for insurance companies who have these companies by the shorts.
May 21st, 2014 at 8:49 am
It won’t happen for one reason – lawyers. I tried to do this myself through my company, a small software company. I wanted to start flying myself around to sales calls and be reimbursed only for actual expenses, in keeping with the FAA regulations on such. My management, all the way to the CEO, were in favor, but the insurance guys and the lawyers shot it down and could not be convinced otherwise. Until liability insurance underwriters and lawyers are educated about the real risk levels associated with general aviation, this will never get off the ground.
May 27th, 2014 at 7:35 am
We are designing the first Global airport – a HUB for VLAs and Community airport ATCOperators
he first to plan for the Florida’s Four Corners.
June 24th, 2014 at 5:20 am
I think airlines consolidating into “large hub” airports should invest in railways to reach the previously served, surrounding areas. In Europe it is a shame if an airport lacks at least some form of light rail connection!
High-speed trains can do 110 or even 150 mph and allow people work their laptops onboard, while cars and Greyhounds are limited to 55mph and can’t be run off hydro-electric.
Of course, USA is antagonistic to rail, be it a streetcar or a japanese bullet train. Yet, flocks of little Cessnas cannot be the solution, considering the rapid variability of weather in US skies.