'Flight to Quality' Helps LEA Steer True Course Through The Recession
London, England, April 30, 2009 – London Executive Aviation predicts that greater activity in its aircraft management business and resilient charter demand for its large-cabin fleet will help it achieve a comparatively strong performance during the current recession. In particular, the company expects to gain market share in aircraft management as smaller competitors succumb to economic pressures.
“The business jet charter market is undeniably tougher than in recent years,” says managing director George Galanopoulos. “However, there remain bright spots in the market and conditions are emerging that should allow LEA to enjoy a comparatively ‘good’ recession.”
Aircraft management and sales are areas where LEA is forecasting growth over the coming months. “We’ve sadly already seen some smaller aircraft management companies fail and, as a result, there are owners looking to place their jets under new management. We’ve also been approached by owners who feel that their present companies simply aren’t delivering on their promises. LEA has a strong reputation in this area and a large fleet of managed aircraft, so we expect to pick up additional appointments as part of a ‘flight to quality.’”
LEA also believes that additional owners may enter or re-enter the market, as a result of the current low prices for new and used aircraft. “We’ve already seen an increase in enquiries about buying aircraft and we expect this to continue,” says Galanopoulos. “We believe that aircraft prices are now at rock bottom – barring the odd fire sale, they won’t go any lower. You can now pick up a low-time used business jet for 20 – 30 percent below list price, which is unprecedented value for money. If you make the right purchase now, not only will you lock in the value for the next two or three years, you might even be able to sell later at a profit.”
On the jet charter side, LEA has seen reasonably resilient demand in certain quarters, such as its entry-level Citation Mustangs and, particularly, its large-cabin business jets.
Within its diverse fleet, LEA presently operates three Embraer Legacys and one Falcon 900EX. It also expects to add a further large-cabin, long-range jet to its fleet later this year. The company is encouraged by a steady stream of large-cabin enquiries and bookings over recent months, which have come from private, entertainment and corporate customers.
“Certain sectors of the economy seem less affected by the downturn than others,” says Galanopoulos. “Most obviously, high net worth individuals are maintaining many aspects of their lifestyles, including how they fly. However, we’ve also seen fairly robust demand from other quarters. For example, the Legacy seems to have reached a tipping point with the entertainment industry – tour managers like the way it offers ample space at a competitive price.
“Corporate demand may be off its recent highs at present, but we’re still taking booking from a range of business customers,” he continues. “This simply underlines that business aviation plays an essential role within Europe’s transportation system. We’re confident that demand will revert to conventional levels and, reading the mood of our customers, we’re pleased to see very early signs that confidence may slowly be returning.”
LEA’s large-cabin fleet has flown to a wide range of locations in recent months, many of which highlight the range capabilities of the aircraft. Destinations have included Geneva, Chambery, Rome, Tel Aviv, Jeddah, Libya and Oman.
“An obvious change is lower charter demand for Russia and Eastern Europe, which reverses one of the clearest trends of recent years,” says Galanopoulos. “However, as with other markets internationally, we expect to see that demand come back to an extent down the road.”
For further information:
+44 (0)20 7664 6310
Notes to Editors:
London Executive Aviation is one of Europe’s largest executive aircraft charter operators and was named Best General Aviation Operator in the Baltic Air Charter Association’s 2007 and 2006 Excellence Awards. The company operates the largest diverse fleet of executive aircraft in the UK. LEA is the only executive aviation company with a full base at London City airport; it operates five further bases around London. LEA is owned by its management and has maintained a record of unbroken profitability since it was founded in 1996. More information can be found by telephoning LEA on +44 (0)1708 688420 or visiting www.flylea.com.
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