Cessna Textron Aviation
Hahn Air Lines
Valair Private Jets
BAN's World GazetteerGermany
EBACE, like other major shows, is often privy to the signing of lucrative aircraft purchase deals between manufacturers and owners or private individuals. In the past year EBAN subscriber data reveals that scores of companies and individuals invested in new aircraft, with countless others taking on pre-owned. In our Annual Buyer's Guide for 2014, we spoke to a selection of those involved in the transactions, and asked them how they made their decisions on which type to select. We also asked about the process of ordering, delivery and entry into service, as well as the pros and cons of new and pre-owned deals.
Finding an aircraft to fit the budget was the primary concern for Germany's Aeroheli International. However, once the specific operational requirements were thrown in, locating a suitable type with a desirable price and flight time limited the selection somewhat. Dirk Franzke knew that the company wanted an AS355, and he soon discovered that only one model would be appropriate. “In our case we didn't want to purchase an F version, we wanted to have an N,” he says. “The market is more limited in this respect and there are not as many aircraft available. Some had a very high price and some had very high flight times. We were looking for something in between, with low hours and a low price! Naturally this reduced our options. But in the end we found one.”
He says that the most important factor in a smooth aircraft handover is ensuring that the paperwork is up to date: “If the paperwork is for a used aircraft and it has not been updated, it is a nightmare to get the aircraft into service. Even with this one, which had superb paperwork, it was not easy to get it onto the AOC.
“Our authority has concerns on everything, so everything had to be proved, and re-proved, and triple proved,” Franzke says.
The operator did not consider any other types; it had sold an AS350 and wanted to use the money to buy a twin in response to growing demand for twin engined rotorcraft. Franzke admits that he prefers to buy new aircraft, but found that in this case the price was prohibitive. “We had to buy pre-owned, and normally the only reason for doing this is that it is cheaper. Aside from that it is always better to buy a new one.
“Buying new is very expensive, and if you are not sure about the amount of flight hours, and payment per flight hour that you will get, it can be a smart solution to stay with a cheaper model. If everything is running as expected you may be able to sell it and go for a new one further down the line.
“Buying a new aircraft, especially of this size, takes a long time. You have to pay a lot of money in advance, before you have the aircraft. All this is difficult for small companies.”
Aeroheli did a lot of investigation in advance, and consulted operator colleagues as well as the manufacturer before making the decision to purchase. “The whole process took at least half a year. The best thing was asking colleagues, because they will probably tell you the truth, whereas the manufacturer may be more economical with it.”
Comlux's client chose a Global 6000 as a natural step up from the Global XRS it owned previously. Ceo Andrea Zanetto says that 'everything went smoothly' during the process of ordering, delivery and entry into service. Comlux Creatives designed the interior of the aircraft in partnership with Bombardier, after which the 6000 was registered to Malta and started flying at the end of 2013. “The XRS was four years old and the owner was looking for a replacement,” comments Zanetto. “We are able to use this aircraft for charter purposes as well as manage it for the owner.” Zanetto used Comlux's internal sales and acquisitions department to consult on the purchase, before buying directly from Bombardier. “We have all the knowledge in-house, which includes contractual and financial matters as well as engineering and technical.”
The aircraft was purchased new, and after routine ferry flights it was delivered 'in perfect condition'.
Sales manager Nuno Gomes remarks that a 'demanding market' led Portuguese Valair into purchasing a Citation CJ3. “We conducted market analysis and felt that there was a need for additional charter capacity,” he says. The purchasing process was smooth from start to finish, and he was happy with the advice the company received. “This was a pre-owned aircraft and everything went according to plan.”
London Executive Aviation
LEA bought a used Challenger 300 for an existing client, and completed the purchase in July 2012. G-LEAZ entered service early last year; though it had been signed for it did not begin operations straight away. Md George Galanopoulos explains the process: “It was an existing owner who had a Citation Excel which he was sharing. He decided to buy his own aircraft. We sourced the aircraft in the used market, which we believe is exceptionally strong.
“It is a pre-owned buyer's market, so at the moment we shy away from new aircraft. It is true that the manufacturers do quite amazing deals on new aircraft, but the value is still with the used at the moment.”
He says that a Legacy was also considered, because the customer wanted something 'sensible' with a super midsize rather than a large cabin, as most of his trips fall within Europe. “Though he does go over to the US, he is happy to stop on the way for one stop,” adds Galanopoulos. “He wasn't looking for large capacity and he enjoys yachting, so the maximum amount of people that he would ever take is nine. Overall the Challenger 300 fitted the bill.”
He sees the Challenger as a very 'charterable' aircraft, and the aircraft's time is split 70:30 between ad hoc charter and trips for the owner. LEA had three previous CL300s, and with that history came the experience, he crew knowledge and a straight-forward transition on to the AOC.
“When we narrowed down our search into the Challenger market, we looked around and spoke to various brokers. We used a company called Colibri Aircraft in London run by Oliver Stone, we use him a lot. He went out and gave us all the options on the market. Our client was looking for good value for money, so not necessarily a new aircraft, but an aircraft that was really good value. The Challenger was. It is a 2004 aircraft so it is not new, but it was very well priced, and the pedigree seemed good.”
The aircraft had one previous owner and was on the Brazilian register. It had flown a lot of hours in the US previously as well as in Europe. The next stage was to identify whether any modifications were made to the aircraft that would prevent it from being, or make it difficult to put on the European register. “We found out that there were some, but that these were easily dealt with,” Galanopoulos continues. “We spent a period of about two months dealing with the technical aspect of it. We did the completion in the US, did a pre-inspection there also and then we flew the aircraft over, changed the registration, added it to our AOC and then imported it for the customer's purposes.
“It's been one of the lengthier transactions that we've done, due to the legal aspect taking longer than usual. On the technical side we wanted to make sure everything was in place.”
LEA sent its own crew out to collect the aircraft. They carried out a test flight at Fort Lauderdale before a final acceptance flight from Fort Lauderdale to Connecticut, where the transaction was completed.
Galanopoulos says that the pre-owned market offers a great deal of choice: “You can buy a four or five-year-old aircraft for half the price of a new one. I don't feel that this will last long but at the moment it is a buyer's market.
“I'm a great believer that the prices for next year will start going up, and at that point the new aircraft will start becoming more appealing, because you get all the warranties. Bombardier for example will give you a five-year warranty.
“But if you look at it dollar for dollar, the extra you spend on your maintenance equates to a warranty – you are still getting better value on a used aircraft.”
The owner flew the aircraft for about six months to get a feel for it, and then LEA carried out a complete refurbishment of the interior and exterior. “The good thing with the Challenger 300 is that all of the avionics are up-to-date, so we don't have to do anything to them, but we lost the aircraft for three months. It is now absolutely stunning.”
Malta Wings purchased a factory-new Tecnam P2006T, and also undertook a lease of a second P2006T which had just 53 hours on it. “Our idea was to provide a 'low cost air taxi' service,” says md Patrick Fenech. “When someone needs to send an urgent package such as priority freight AOG, or if a person needs to go somewhere which isn't usually served by airlines or even business jets, we can offer them our service at a fraction of the cost.
“We can make it possible for people to travel to places that are not served by other aircraft, or who have a limited budget and want to save money.”
He considers the four-seater P2006T to be a very efficient and capable aircraft, which is fully equipped with the latest instruments. It is able to fly on a 24-hour basis, and Fenech adds that this is made easier by the favourable weather in the south of Europe.
The aircraft plays an important role for the Malta School of Flying, a flight training organisation and sister company of Malta Wings. “We wanted to look for an aircraft which was dual purpose,” states Fenech. “We did not want to start with a Piper Navajo or a Piper Chieftain, because they are not suitable for flight training; they are too big and too expensive to operate. The obvious choice was to go for a four-seater and then grow from there.
“The twin engine aircraft is being used for multi engine training, for part of the commercial pilot's license, and also for part of the instrument rating. Again, the market we want to serve is the person, or two persons that want to go somewhere, and therefore a four-seater will be more than enough for the charter market.”
By this means, the students are able to use an aircraft with the latest technology, with competitive prices due to its four seats. Charter customers can also get a good price using the Tecnam, as Fenech adds that it is very economical.
He ordered the aircraft from Tecnam after evaluating other options such as the DA42 and Piper Seminole. The superior operating and purchasing costs of the Tecnam prompted the operator to choose it. The close proximity of the Tecnam factory was another bonus, as it is only two hours flying time away from Malta. “When it comes to parts and to certain maintenance we can easily fly back to the factory and have it done over there.”
Malta Wings ordered the aircraft after a three-month consultation period. The aircraft was ready in accordance with its specifications, and after the CAA certification was issued, Fenech's team did some test flights, accepted the aircraft and then flew from the factory, which is north of Naples, to Malta.
As to the advantages of new over pre-owned, the company chose new as it felt that this would be a wiser decision for a multi-engined aircraft. “This is a twin-engined aircraft with retractable undercarriage and advanced systems,” says Fenech. “We wanted to put our minds at ease by having the warranty, which covers the aircraft for two years. When buying a pre-owned aircraft one needs to be very careful because there is the potential for problems with the undercarriage and the engines.”
In Malta there was no dealer for Tecnam aircraft, so Malta Wings approached the manufacturer itself. “We sent engineers over to Tecnam and they took specific courses on the aircraft. Following that we started selling aircraft for Tecnam in Malta.
“We are looking forward to the P2012 Traveller, which is expected in the market and has lots of options and the flexibility to be used as a commuter, for medevac, parachuting and cargo operations too.”
UK-based Synergy Aviation selected a King Air for its short field performance, enabling it to operate to many airfields inaccessible to other aircraft types. Md Glen Heavens says that Beechcraft handled the purchase well, which has also been the case with several previous transactions. The operator carried out the ferry flight itself as it has longstanding experience in ferrying.
German operator Hahn Air's long-term relationship with Cessna made the decision to purchase an additional CJ4 an easy one, according to coo and general manger Daniel Rudas. “Extending our fleet with the same type of aircraft speaks volumes for the outstanding experience we have had with a machine from the CJ family. Familiarity has played a substantial role in our decision process.”
The purchasing process was equally stress-free: the aircraft arrived at Hahn Air's base in Düsseldorf airport very swiflty after the order was made. “The manufacturer provided a schedule which we drafted together with them in October 2013. This was met every step of the way.”
Rudas goes on to say that the intention behind purchasing additional aircraft was to renew and expand the fleet. “The recently delivered CJ4 is an essential part of Hahn Air's plan to extend its charter flight network from Frankfurt Egelsbach,” he adds. The latest Citation will be used for scheduled and charter flights and is factory-new. He is delighted with the attention to detail demonstrated by Cessna.
Northern Helicopter is on the brink of purchasing an AS365 N3+. Due to the nature of the work carried out by the German company , ceo Frank Zabell says that his choices for aircraft type were limited. “There are only a few helicopter types that are right for us,” he comments. “Overall the best helicopter for the job is the one we have selected. It is fast, it has a long endurance, and we already have it in our 'system'. Our pilots are used to flying this type.
“In terms of endurance, the power and what we can take with us, plus the speed, this helicopter is ideal. I did a test flight in March, and the way it looks at the moment we will probably sign for the contract in May. We started negotiating about three months ago and delivery will be in October.”
The aircraft is new, as Zabell was unable to find one with the desired specification in the used market. “It needed to have a four-axis autopilot because of the offshore rescue work that we do, and there are none available pre-owned.”
The operator didn't take any external advice when buying, aside from aircraft brokers who assisted in scanning the market to get an overview of availability. “We didn't speak to anybody with regards to what will be the best aircraft for the job, because we know that already by working on it.
“Overall I have been happy with the service. Of course sometimes things could always go faster, but you can't change that. Sometimes it can take a big manufacturer a long time to clear up a small detail, but aside from that I have no complaints.”