Not Open For Business

Those staff shortages have meant weary passengers coming off long-haul international flights, or those heading overseas, have often faced a lengthy wait to go through passport control. And those flying in on business jets are no exception.

Ideally, Australian Border Force staff make their way to an airport’s FBO to process passengers and crews travelling on business jets. This is known as “off-terminal” processing, which is the normal practice at foreign gateway airports.

However, the lack of resources at Australian Border Force means no off-terminal clearances are possible at certain times of the day. Instead, arriving passengers and crew have to taxi over to the international terminal to join all other international passengers in a process that takes time and impacts airport operations given aircraft often have to cross active runways.

And the situation is so dire at Perth Airport that off-terminal clearances are virtually non-existent, except for medical evacuation-type flights. While there is a a small window for international business jet flights to arrive and depart Perth, all processing takes place at the main international terminal, Australian Business Aviation Association (ABAA) chief executive David Bell explains.

“At Perth Airport everyone apart from medevac type flights has to go to the terminal and they can only go to the terminal between 8am and 12 noon every day,” Bell tells Australian Aviation in an interview.

“Outside of 8am to 12 noon you can’t get cleared at Perth. ” There are about 400 aircraft in the business aviation sector in this country, with about 180 of them business jets and the rest turboprops. Roughly one-third of ABAA members travel overseas regularly, meaning there is a significant chunk of Australia’s corporate leaders who are unable to take full advantage of one of the key benefits of a business jet.

Sure, business jets offer the flexibility of travelling between two points unserved nonstop by the major airlines and give the executives who fly on them the ability to stay connected while in the air.

They should also save time. Instead, “blackout periods”, where there is either no processing or processing only for emergency-type flights such as medical evacuations, have created a “huge pressure point” in recent times, Bell says.

While Sydney Airport has been coping well and is regarded as one of Australia’s best airports for business jets, the same cannot be said of the country’s other major international gateways.

“Melbourne, Essendon, Perth, Darwin and Brisbane to a lesser extent have all been worse this year from an off-terminal clearance point of view than last year,” Bell says.

“We’ve had more blackout periods at those airports – not Sydney so much, Sydney has been quite smooth – than last year.

“There have been major issues because of staff shortages and we have met extensively with the Department of Immigration and Border Protection in those cities. We have a very good relationship with the Australian Border Force, they are trying to help us.

“There is no us and them. The fact is they are understaffed and they can only do so much. They just don’t have enough people. ” One recent improvement at Perth Airport has been that crew-only flights have been able to drive airside to the international terminal for clearance.

Meanwhile, at Melbourne’s two international airports, Tullamarine and Essendon, all international business jet flights have to go to the international terminal for clearance between 0830 and 1130 every day.

With no Australian Border Force staff based at Essendon Airport, Bell says that airport is “effectively shut down for international operations during those three hours”.

About 40 corporate jets have their home base at Essendon, which is understood to have the most number of international movements outside of the major airports in Australia.

It is a major centre for corporate jet activity in Australia, given its close proximity to the Melbourne CBD and the flexibility it offers given there are no domestic and international airlines operating at Essendon.

The likes of ExecuJet and Executive Airlines are based at Essendon, which has four FBOs there, as well as Victoria’s emergency services fleet and a number of regional airlines offering regular public transport services to towns such as Griffith, Flinders Island and Merimbula.

“The thing that is important about Essendon is at Essendon the corporate jets are, to turn a phrase, they are the rock stars here,” Essendon Airport chief executive Chris Cowan tells Australian Aviation in an interview.

“They really are the top of the tree. ” Essendon Airport’s credentials as a business jet hub were on full display during AFL Grand Final week, when it had 15 visiting jets parked on the apron as a hoard of visitors from Western Australia headed east to watch the West Coast Eagles take on Hawthorn.

“Someone said to me there were more jets here than in 1970 when Tullamarine opened. It was quite a big day for us,” Cowan says.

“We’ve got staff that have been here for 38 years. No one here had ever seen that many jets on the apron before. ” The airport recently completed an $8 million runway overlay project, while two new hangars – one for corporate jets and another for emergency services – are under construction.

Despite all this impressive activity, Cowan says Essendon is also struggling with Australian Border Force, particularly at peak times when it can be difficult to get people over from Tullamarine to clear passengers.

“Customs have resource issues across Australia and that is an issue we are working on at the moment to make sure that customs can turn here on a timely basis,” Cowan says.

“We are working with them on that and we need to get a solution to that because to be honest that is restricting us at the moment. During peak periods we need to get some better service out here.

“The answer is not to have people wait for customs to come. The answer is when people come to Australia, to the front door, they should be met by a customs service. That is what Border Force does. ” Beyond customs, Australia’s corporate jet operators who operate charters are also having to deal with proposed new rules for passenger flights, known as Part 121.

The ABAA has been represented on the Part 121 working group looking at the new regulations.

The Civil Aviation Safety Authority (CASA) is seeking public comment on having charter flights come under the same safety standards as RPT services, which CASA said in October would result in “improved safety standards in some areas of operations for non-scheduled flights which are currently classified as charter”.

CASA said the proposed rules would apply to passenger and cargo operations in aircraft fitted with more than nine passenger seats or with a maximum takeoff weight of more than 8,618kg. Many of the proposed changes would formalise current practices, while others would simplify compliance.

Outlook subdued

The annual Business Aviation Outlook report from Honeywell Aerospace suggests a flat market amid weakness in a number of key economies.

The Honeywell forecast is for up to 9,200 new business jet deliveries between 2015 and 2025 worth US$270 billion. The figures represent a three to five per cent decline from the 2014 estimates.

Newer models coming onto the market during 2015, as well as the increase in “fractional-usage” aircraft being bought has helped push the number of deliveries during the year to somewhere between 675 and 725 new jets, representing “single-digit percentage growth year over year”, the Honeywell report says.

The report says 2016 deliveries are projected to be slightly lower, reflecting weaker emerging market demand partially offset by deliveries to fractional operators.

Business jet operators planned to make new jet purchases equivalent to about 22 per cent of their fleets over the next five years for either replacement or growth.

“Of the total new business jet purchase plans, 19 per cent are intended to occur by the end of 2016, while 17 and 20 per cent are scheduled for 2017 and 2018, respectively,” the Honeywell report says.

More than 80 per cent of the total amount spent on business jets was expected to be on aircraft in the super mid-size category or above, Honeywell said.

“While emerging markets like Brazil continue to be a bright spot for business aviation over the medium term, we have seen weaker demand across other key growth markets, which may affect near-term order and delivery levels,” Honeywell Aerospace president for business and general aviation Brian Sill says in a statement accompanying the launch of the report on November 15.

“And while the sluggish economic growth and political tensions are driving a more reserved approach to purchasing, we are seeing operators invest in retrofits and upgrades for their existing aircraft, especially around connectivity, boosting aftermarket opportunities. ” The report’s outlook for Asia Pacific, which excludes China, says operators in the region expected to buy new jets equivalent to 14 per cent of their current fleet, up two percentage points from the prior year’s survey.

“Disappointing growth figures from several major regional economies, ongoing regional tensions and government austerity initiatives dampen operator enthusiasm,” Honeywell says, echoing a very similar statement about the region in its 2014 report.

“Despite the below-average level, the improved purchase plans yield about a four per cent share of global demand over the next five years for Asia Pacific. ” Honeywell says North America would continue to generate the bulk of the global sales, with the region tipped to have 61 per cent of all purchases, up two percentage points from the 2014 report. North America had about 65 per cent of the world’s business jet fleet.

Bell says although the weaker Australian dollar compared with the US dollar has made purchasing business jets more expensive, aircraft are still being bought in this country.

“Of course the exchange doesn’t make it very easy with the Australian dollar sitting about 70 US cents or thereabouts,” Bell says.

“If you have to find the Australian dollars to buy one you have to find a lot more than a year ago. That is an issue which may impact some of the buying decisions.

“I haven’t noticed people selling their aeroplanes, there are still new ones coming in.

“In Australia, as far as business jets are concerned, we are still trending towards the larger aircraft – mid-size and larger business jets. ”

The corporate jets are . . . the rock stars here.