Update to Career Plan

Update to Career Plan

Career plan wise, I’ve always said that I’m not the kind of person whom likes to have a direct -- firm career goal or path.  Sometimes you need to expand your horizons and keep an open perspective, and as such, maybe you'll find something along the way that interests you more. Though, every person is different and everyone makes decisions differently. Nonetheless, I prefer to keep an open mind, and I have preferences as to what I’d like to do career wise, but no firm dead-set path. The 'general direction' where I’m going is certainly aviation related, but where in aviation is something that'll remain to be seen. I'll say this, though. One thing for sure, I’ve learned that in the 4 years I’ve had here at Eastern, I’m certainly not the kind of person that would be interested in anything to do with the corporate world. Nearly all of my business classes (for the business minor required per the Aviation Management) degree, I just couldn't stand. It's interesting though as just two years ago, I thought to myself -- you know, once I get that business minor, I could use that to work my way up to grad school and get an MBA (Masters in Business Administration), since most (if not all) of those classes are prerequisites anyways. After taking all of those classes, I can guarantee you I’ll be staying clear away from an MBA, yet alone any further business related classes. I just have zero interest in accounting, finance, management, or business. Aviation management's another thing and if I was going to use my management degree for something, I’d use it to work as say, 'Director of Operations' for an airport, or something of the sorts. I've never had an interest in corporate aviation and I still don't, probably even less so now (after taking those business classes) than I did before. That's just not my forte.

After school, going back to potentially going for a masters degree, while I’ve completely lost all interest in the business-side of things, and an MBA overall, I’ve found a secondary interest (secondary to aviation) in economics. Sure, most people completely hate economics, have a hard time with it, etc. Though, when I took macroeconomics and microeconomics here at Eastern, I loved it. It made perfect sense, I felt like it was perfect common sense emphasized through graphs, numbers, and a bit of theory. In fact, I came extremely close to declaring a double major and getting a second bachelors in Economics, but turned it down since it'd take another year of school. Sure, 1 year isn't much, but I may as well get a masters in it instead. Therefore, maybe after graduation, it's possible I may return to school to pursue a masters in economics, not particularly because I want a career in economics, but more less because I find it fun, which I’m sure sounds pretty crazy to most people. Though I think it'd be a pretty cool degree to have. I've also considered something aerospace related (I love aerospace), but not anything engineering related (no interest in engineering). I've also considered a masters in something aviation related, but that seems somewhat redundant, I think an economics masters would be a nice 'out of left field' kind of degree to portray on a resume, same can nearly be said for an aerospace degree. Therefore, with respect to career plans, it's possible that I may not pursue a career for another year or two; perhaps I’ll go to grad school for economics (or some other degree).

Career specific with respect to aviation? Assuming no immediate grad school, I've always wanted to be a pilot and that's that, really. Will I be one? I'm not sure. I can't answer that, really, as a career. I'll be a pilot (private pilot and such), but as a career, I’m not sure. There are a lot of pros and cons involved. Become a pilot and I’d be immensely loaded in debt. Or, take another route and not be loaded with debt. Tough choice. Never thought I’d be interested in dispatch but again, taking classes over the years can kind of coerce you in different directions and interests (goes back to my mentality of keeping an open mind), some you may never have thought of. Having taken the dispatch courses, I love the material, I enjoy it a lot, and it’s a lot of fun. With that being said, maybe I’ll become a dispatcher? Probably only as a temporary job for a few years while I work through the pilot ratings. I think it'd be a lot of fun. Flying is fun to me, as is the dispatch coursework, along with economics. I think it's important to do what you find fun. Doing my business minor? Absolutely dreadful, because I had zero fun in the process (zero interest in the material). Doing dispatch, economics, etc. and classes that I’ve enjoyed? A lot of fun. Take that interest and attach it to a career, and you'll have a fun career. That's all that really means.

Couple other avenues -- I’ve thought about ATC. In fact, it's something I highly considered the last few years, but recently I’ve just seemed to have lost interest. No particular reason why, perhaps its lack of knowledge about it, lack of hearing about it, etc., I’m not sure. Last I checked (a few months ago) and over the last year, they haven't been hiring anyone from the general public, only ATC graduates (ATC degrees) from accredited schools. While they get paid well, would I enjoy sitting in a dark room for 8 hours a day? Eh. I can't answer that because I don't know. I know if I was sitting in the tower cab at an airport, I’d be sitting there wishing I was flying the planes I was talking to, and not sitting in this dark room talking to the pilots of those planes. How much I was getting paid wouldn't matter at that point. I've also thought about the military; Air Force & Navy. Military just isn't my thing, really, but it's crossed my mind. The Navy just recently sent me a letter in the mail (a week ago) trying to recruit me as a naval aviator officer (somehow they knew I was graduating in a couple weeks). With that, I could fly planes in the navy (F-18's, helicopters, etc.), get all my flight training paid for -- and I’d enlist as an officer (since I’d have a bachelor’s degree). Sounds great, but there's a commitment involved (I believe its 10 years). Still something that's on my mind but more less a "last resorts" option if I was set on becoming a pilot and by all means necessary couldn't due to something financially related.

All said and done, I want to fly, preferably for the airlines. Or I’d like to dispatch (most likely temporarily, till I can get to the airlines). And, or, perhaps the midst of all this, pursue a masters degree, probably in economics or something aerospace related. Who knows where I’ll end up, but to me the uncertainty of it is pretty exciting. It's like rolling the dice and seeing what you get. I've never been concerned about my career, nor worried about it, I know where I’m going is the right direction, and I’m sure I’ll end up where I’m supposed to be. A good analogy is that I feel like I’m in the right parking lot, I just haven't found the right parking space, yet.

Industry Mergers Update

Update to "Industry Mergers" Topic -- Posted February 3rd, 2012.

1) Describe a post-1978 merger. Include basic details, such as name of the companies, reason for the merge, challenges of the merger and consequences or benefits of the merger (such as furloughs or new routes, for example).

*Update on Delta & Northwest Merger since last post on February 3rd, 2012.

The Delta/Northwest merger is one that I discussed quite in depth in my original post on February 3rd, 2012. Since that time, nothing particularly major has occurred. However, with such a larger airline that Delta is, there are, of course -- a few things that have happened since that time. While the merger is still underway, fleet integration (and updating the fleet as a whole, particularly the interiors of the Northwest-aircraft) are still underway. On February 15th, Delta announced that they'll be renovating the entire 747-400 fleet (all prior Northwest-aircraft) and configuring the interiors towards Delta's standardized international-interior configuration. 48 full-flat business elite seats will be installed, featuring an array of amenities, such as LED lamps, personal monitors with over 1000 entertainment options, and other typical 'Business Elite' amenities from Delta. The product will be on par with Delta's 777 fleet. Economy will get an upgrade also, with transitioning towards slim line seats, consistent with the rest of Delta's interior-based products. While this may not sound like significant news, it is when you consider that much of the flights revenue comes from its business class customers, many of which whom are highly particular when it comes to the amenities and seating configuration in business and first class. Integration throughout the entire 747 fleet should be completed by October 2012 -- Delta 747 Seat Updates.

Also in the news, Delta recently expanded their codeshare agreements with China Eastern and China Southern to cover routes out of Seattle and Detroit for flights to Beijing. This means customers travelling on Delta aircraft from Detroit and Seattle to inner-China cities could fly to Beijing and easily transition to a China Eastern or China Southern flight. Delta already has codeshare agreements in place with China Southern and China Eastern with respect to flights from New York/Los Angeles to Shanghai, and Los Angeles to Guangzhou -- this recently news is simply an expansion of that codeshare agreement. The agreement allows significantly easier access to (at present) 52 cities in China, serviced amongst China Southern & China Eastern -- Delta Expands Partnership with China Southern & China Eastern.

Lastly, Delta recently expanded operations at New-York LaGuardia’s airport, its largest expansion in more than 40 years, featuring the addition of 100 new flights and 26 new destinations between spring and summer 2012. Once completed, Delta will feature the most daily departures out of LaGuardia than any other carrier, conducting 260 daily flights to over 60 cities. All said and done, the expansion will yield 4 million additional seats to the New York market. Moreover, Delta will also renovate two of their terminals at LaGuardia, in addition to connecting them to each other (not presently offered). The project will bring 700 new jobs to the airport -- Delta Launches Historic Service from LaGuardia.

2) Describe a current merger - i.e. one that is in the process. Some choices would be United/Continental or Southwest/AirTran, but you aren't limited to these choices if you can find others. Answer the same questions listed in 1).

*Update on Southwest & AirTran Merger since last post on February 3rd, 2012.

A few major things have occurred since February 3rd, 2012, with respect to the merger between AirTran and Southwest. One, on March 1st, 2012, the FAA approved a single operating certificate for both carriers -- Southwest & AirTran Single Operating Certificate. In essence, both airlines are now viewed as one, despite the fact that the merger is far from complete. With the operating certificate taken care of, Southwest can now begin the rebranding process -- that is, painting AirTran aircraft into Southwest colors, reconfiguring all AirTran interiors, rebranding at all airports, merging ticketing, reservation systems, and a horde of other important merger-related functions. All of these issues are completed slowly (and sometimes tediously) over a span of several years, depending on the two airlines being merged. In this case, it'll be about around the same time frame (speculative, of course), of probably (at least) 2 years. Interesting fact is that it takes about 45 days for an AirTran aircraft to be reconfigured into the Southwest configuration. This includes repainting the exterior, replacing the interior, galley and lavatory repositioning and appropriate cockpit adjustments (nav updates, Southwest configuration, etc.). The first AirTran aircraft arrived in Seattle the first week of March to be configured in a Southwest configuration; with a 45-day span, we're only about a week or two away from seeing the first fully reconfigured AirTran > Southwest aircraft -- AirTran & Southwest Single Operating Certificate.

In other news, Southwest recently announced that they'll be forced to switch several proposed Southwest routes back to AirTran. The announcement is only with respect to flights out of Atlanta. The original plan was for Southwest to take over several Atlanta-based AirTran routes in many markets this year, markets such as Atlanta to Los Angeles, Atlanta to Chicago-Midway, Atlanta to Las Vegas, and a few other select routes. The plan was to shift these routes from AirTran to entirely Southwest-based crews and aircraft. However, Southwest recently announced that these flights will retain flights via AirTran, due to several issues. One, it's taking longer than expected to reconfigure the AirTran aircraft as necessary, and the transition won't occur at a fast enough pace necessary to fulfill the proposed route changes. Two, Southwest still doesn't have an interline agreement with AirTran. In other words, they're having computer problems (IT problems), because they haven't been able to merge the ticketing systems together yet, which means they can't tag checked baggage between both carriers. So, a customer wanting to fly Atlanta-Chicago Midway-Las Vegas, and the Atlanta-Chicago route is on AirTran while the Chicago-Vegas route is on Southwest, the customers bag's would have to be rechecked in Chicago. Southwest lacks the capability to tag the baggage in Atlanta all the way through to Vegas. Clearly, this would be very detrimental to Southwest (and AirTran's) customers. Because of all of these nuances, Southwest decided it'd be best to leave AirTran aircraft on their present (original) routes, and as they are -- until these issues can be fixed -- Southwest Shifting Atlanta Service.

In an interesting twist, there's been rumors floating around on the internet that Southwest plans to rid themselves of the entire 88 AirTran Boeing 717's, and instead -- send them to Delta Airlines, whom are (speculatively) the interested acquirer. Supposedly, the 717's are to be sold off at such a cheap price that Delta is considering acquiring them, and after all -- they're the perfect replacement for the DC-9's, nearly all of which have been retired (there are many DC-9-50's that are still flying, but retirement should be completed this year). The 717 is nearly identical to the DC-9-30 in terms of passenger capacity, and, in many ways -- is a modern derivative of the 717. Southwest's CEO Gary Kelley refused to comment on any 717 deal, but did comment on some major points with respect to the 717 development, potential furloughs, and the Southwest fleet overall. Nonetheless, this news is something that's spread on the internet over the last week and a half, and has been heavily discussed in aviation forums. Check out more information by clicking here

There is some credibility to the rumor, particularly the fact that on March 29th, Delta, Hawaiian (another operator of Boeing 717's), Air China and Southwest Airlines all met in Phoenix to discuss 'Fleet Strategy' -- click here to view the article.

3) Describe the future of American Airlines. What lead to bankruptcy? Who's interested in merging with them and why? What do you predict for the future of this company?

*Update on American Airlines since last post on February 3rd, 2012.

Just over the last few days, US Airways has pushed significantly for a merger between themselves and American Airlines. US Airways is strongly pushing towards a merger particularly because American has recently asked a judge to abandon labor contracts in an effort to cut costs. US Airways ramped up their interest (going so far as to provide financial estimates of the merged airline to American's creditors) considering these issues regarding labor contracts. Internal negotiations at American's labor unions (in an effort to cut costs) have stalled and/or been rejected. American's now seeking court approval to void its union contracts, which would help save the airline over $1.25 Billion -- American Seeks Approval to Void Contracts.  The cost reductions include 13000 job cuts and various other concessional-based cuts, and are part of their recovery efforts under the restructuring agreement with respect to their recently filed Chapter 11 bankruptcy. Also, American has made clear that they want to stay an independent airline, and want to exit bankruptcy alone (without a merger) -- US Airways Pushes Merger.Moreover, American was recently granted an extension on coming up with a full-on reorganization plan, giving them another 6 months to do so. American's CEO has specifically stated that they have no interest in any mergers nor will consider any until the airline emerges on its own from bankruptcy proceedings. This was mentioned and discussed in depth via the wall street journal article above.

Other than that, not much has happened with respect to American. They're still losing money, having lost $619 million in the month of February alone. This brings the total loss to a staggering $1.76 billion since the time the company filed for bankruptcy last November. Their largest expense? No surprise, fuel. With their aging fleet of primarily MD-80 based aircraft, all of which are highly inefficient, fuel and fuel expenses remains American's largest problem. Additionally, overall revenue is down 10.8% from this time last year, and passengers flew 8.2% fewer miles. You can read more about these figures by clicking here. 

UAV Sector of the Aviation Industry

1) What is the current status of this sector of the industry?

The UAV sector of the industry is primarily used by military operations. At present, the sector has been expanding, and will foresee exponential growth in the future. Currently the Pentagon has over 7000 aerial drones, a stark comparison to a mere 50 drones on hand nearly a decade ago -- Predator Drones & UAV's. Moreover, Congress was recently asked to instill approximately $5 billion dollars into the 2012 federal budget for the drones themselves. The importance of drones in the US Military cannot be underestimated. They've played a critical role in the war on terror, particularly with respect to missions carried out in the Middle East (Afghanistan, Iraq, etc.). They've also killed several well known terrorists with their onboard lethal armament, eliminating the human-risk element in the process. That's one of the greatest benefits of the drone program -- the lack of the risk towards human life, which can be eliminated via the use of such drones. Nonetheless, the current status of the UAV industry is that it's rapidly expanding, thanks to its military success.

2) What are the issues in these sectors that must be evaluated while moving towards the future?

One of the issues is with respect to personal privacy. That's a big problem with foreign countries and the use of US-based drones. Many of those countries (such as Pakistan) have complained about the use of American-drones, comparing it to spy-equipment, and complaining about its use as a deadly weapon. Pakistan recently made a statement within the last few weeks citing that the United States should respect Pakistani 'sovereignty, independence and territorial integrity' -- Predator Drones & UAV's. Domestically, privacy is also a concern. While there are no present rules and/or regulations regarding privacy and drones, the concern is that commercialized drones could be used for surveillance purposes here in the US, without the knowledge of those being surveilled, of course. In other words, a case of 'big brother watching us all', or anyone for that matter (since drones are entering the commercial sector) having the capability to remotely surveil people. Other concerns are coming from human rights activists. Human rights activists are claiming that the being overtly dependant on technology to make killings by the US Military more easily attainable, drone operators may see killing people as simply a game, akin to playing a video game. In May 2010, a drone operator had launched an airstrike from the drone he/she was piloting, leading to the death of 23 Afghan civilians (women and children amongst them -- Innocent Afghan Deaths by Drone Operators. The American military claimed the airstrike was caused by inaccurate and unprofessional judgments by the drone operator(s) conducting the flight.

3) What is the 5-10 year outlook for this sector?

The projected outlook 5-10 years from now is progressing towards substantial expansion of the use of UAV's. On February 14th, 2012, President Obama signed a new federal law granting allowance to the FAA for use of drones for commercial operations. Commercial operations such as aerial photography, real estate overviews, crop dusting, oil spill and wildlife monitoring, and comparable commercial endeavors -- Predator Drones & UAV's. Police agencies and emergency based services will also be allowed to utilize drones for their services. Because this new law was passed, you can expect the UAV manufacturing business to soar. Commercial-based drone activity will now be available. Obviously the FAA will have some regulations regarding this (and they already do, such as the requirement of drones less than 4.4lbs for police/emergency services, and a max flight altitude of 400 ft). This whole genre is still quite new to the FAA, particularly with respect to the commercial sector, so it'll be an ongoing effort for the next 5-10 years as more regulations are established and commercial drones are made readily available.

4) What is/will the government's involvement be in this sector?

The government already has a heavy involvement in the UAV sector. At present, military operations are all governed by the government. Commercial operations were granted by the government, and the FAA will also oversee the appropriate rules/regulations regarding the commercial operations of UAV's. The governments involvement is substantial as they're essentially responsible for the development of the UAV market (military use), and its subsequent spread towards commercial use domestically. In many ways, the governments involvement with UAV's will be on par with it's involvement with your typical human-piloted aircraft. There's a military sector, and a commercial/private sector. Basically the same development with the UAV's, minus the human element.

5) What are possible career opportunities in this sector (be specific, which may require you to find actual job descriptions)?

Career opportunities in the UAV sector are very comparable to those found in aviation as a whole. A career as a UAV maintenance technician, for example, is one such career. Of course, the jobs as a UAV pilot are also available, and seem to be very easily attainable. Most simply require a high school diploma -- UAS/UAV Operator Career. Because the expansion into commercial UAV operations is now underway, jobs such as sales and marketing, management, customer service and other various opportunities are (and are soon to be) available in relatively large quantities. Most of these jobs seem pretty easy to obtain if you have a college degree (which we'll all have). If none of these jobs suite your interests, you could also pursue the manufacturing route (engineering, design, manufacturing, etc.). At present, there are already many, many companies you could work for -- check out all the UAV companies by clicking here. With the expansion that's projected over the next 5-10 years, one should expect an immense amount of job opportunities.

Ex-Im Bank & The Aviation Industry

Export-Import Bank of the United States.
http://www.exim.gov/

1) What is the Export-Import Bank?

The Export-Import bank is a federal-government based credit agency for the United States. Essentially, they're a financing company backed by the US Government. It's a longstanding agency that was established over 75 years ago during the Great Depression. The purpose was to facilitate the exportation of American products, particularly during World War II. It’s part of the executive branch of the United States, and its sole intent is to provide financing to foreign entities for the purchase of American products and/or goods. The bank itself is self-sustaining, and its primary purpose is to help maintain and create American jobs by financing the sale of exported American-produced goods. The bank itself takes on enormous risk that private-based creditors are not willing to accept (the risk of loan default). Private companies are often unwilling or unable to accept certain risks by financing huge-sales, such as the sale of a significant number of American-manufactured aircraft to foreign entities. To support the sale of these American commodities, the Ex-Im bank provides the necessary financing to the foreign entity. Moreover, the Ex-Im bank fully insures the sale and financing, therefore -- American companies will get paid for the purchase regardless of what occurs with the loan (such as if it defaults).

The Ex-Im bank provides two types of loans; Direct Loans, and Intermediary Loans. Direct loans are loans provided directly to foreign buyers of American exports. Intermediary loans are loans provided to other lending agencies, whom then use those funds for lending purposes. A great way to think of the Ex-Im bank is to think of the way student loans work and operate. Few (or in some instances, none) of the student-loan companies in the US are willing to provide student loans to students straight out of high school (age 18-19). In the instances that they have, the loans provided were at very high interest rates, and/or very low amounts. To help students go to school, the US Government provides federal funding (federal financial aid) to students, in the interest of promoting higher education. Stafford Loans are an example of this. The purpose of financial aid for students is to provide funding for students to further their education post-high school. Without federal funding, few students would be able to go to school, and/or would have a very difficult time obtaining loans. The Ex-Im bank works the same way, but with respect to the exportation of high-value American commodities.

For instance, let’s suppose that 'Saudi Arabia Aircraft Leasing Corp.' was interested in purchasing 40 Boeing 737-800 aircraft for the purpose of sub-leasing them to various Middle-Eastern airlines, and SAALC needed financing for the sale. The average cost of a 737-800 (roughly $80 Million), times 40, and you're looking at financing approximately $3.2 Billion dollars. Would Chase Bank of American or CitiGroup be interested in financing a $3.2 Billion dollar loan to a Saudi Arabian company? Likely not. Chase or CitiGroup or any other American entity may not even have that type of cash-on-hand available for disbursement, either. Even if the they were able to finance such a loan, the interest rates offered by these financing companies would likely be so unappealing that SAALC would likely reject their financing offers, and either not purchase the aircraft all-together, or significantly reduce their order size. To ensure this doesn't happen, the Ex-Im bank would handle this sale. Why? To support the sale of such pricey and valuable American commodities, such as the aircraft produced by Boeing. Ex-Im would finance the entire $3.2 billion. Boeing would receive a guarantee on the loan, meaning Boeing's risk of default is zero. Thereby meaning, Boeing (or any other American company backed by a purchase completed through Ex-Im) is going to get their money, period. 

2) What is its relation to the aviation industry?

The Ex-Im bank finances high value commodities such as aircraft, locomotives, manufacturing plants, American-equipment, even international construction projects such as bridges, skyscrapers, and other various high-priced commodities. With that being said, the Ex-Im bank is extremely important for those commodities manufactured here in the United States. Why? Because most other urbanized-industrialized countries have the same type of government-backed financing to support the sale of their commodities for -their country-. If the United States couldn't finance such commodities, sales of these types of commodities would plummet. If you go back to the Saudi-Arabian example I gave above, if SAALC couldn't obtain the $3.2 Billion worth of financing to purchase those 40 Boeing 737-800 aircraft, or if they did obtain the financing -- but at a poor interest rate, wouldn't they shop elsewhere? Of course they would. Where would they go? Probably straight to France, and why? The country of France has their own Ex-Im-type bank to back the financing necessary to sell their French-produced Airbus aircraft. So, if they could obtain the financing from France for 40 Airbus A320 aircraft (which would roughly cost about $3.2 Billion also), at a pleasant federal-interest rate, but couldn't from the US (say because we lacked an Ex-Im bank), then of course they would buy the Airbus aircraft. Subsequently, sales of these pricey-American commodities would suffer dearly as a result, something we fortunately have not experienced since the establishment of the Ex-Im bank...yet -- anyways (see #3 below).

3) Why has it been in the news lately?

It's been in the news lately because the Ex-Im bank is about to reach its $100 billion lending cap within the next two months. As such, congress needs to authorize a lending extension by May. There's no denial that the charter that permits the Ex-Im to exist (which must be renewed by May 1st) will be renewed, the problem here is the extension of the lending cap. Once the lending cap is reached ($100 billion) as anticipated sometime before June, no further financing could occur by the Ex-Im bank. All said and done, they'll basically have no more money to lend, having capped out at $100 billion (the lending cap). Financial support from the bank has risen so much over the last few years (doubling over the past four years to approximately $41 billion annually) that it's caused the bank to approach it's lending cap limit of $100 billion far in advance than previously anticipated -- Ex-Im Bank & Congress Approval. There's much debate in Congress over reauthorizing the lending cap, something with President Obama supports (to help create American jobs and boost exports), but is still an ongoing issue in congress. There's a lot of politics involved, pros-cons, etc. of whether to extend the lending authorization, or not -- something which I won't get into, nor interject my opinion on, but you can read all the pros and cons of the potential reauthorization and the Ex-Im bank as a whole by clicking here.

4) What is the ATA stance on this? What about Boeing?

Boeing is confident that the lending cap will earn an authorized extension -- Boeing Confident. Additionally, Boeing is the largest beneficiary of the Ex-Im bank's financing --Export-Import Bank & American Firms. Boeing wants to sell planes, of course, and the Ex-Im bank helps them do so. Clearly, they're going to 100% support anything and everything to do with increasing lending capability within the Ex-Im bank.

With respect to ATA, the Air Transport Association of America Inc., the ATA does not support the lending cap extension. In fact, the ATA recently filed a complaint against the Ex-Im bank with respect to a recent sale of Boeing aircraft to Air India. The complaint alleges that Air India, whom was unable to obtain financing for the purchase of the Boeing aircraft, was able to obtain financing through the US's Ex-Im bank. As such, Air India was able to (and will be able to) use the new Boeing aircraft to compete against American carriers on lucrative international routes. You can read more about the ATA's allegations by clicking here. In essence, the ATA's complaint is that because the Ex-Im bank helps foreign air carriers obtain capital to purchase Boeing aircraft, those carriers are then using those Boeing aircraft (financed by the Ex-Im bank) to compete against American companies (American-based air carriers).

Corporate Aviation Company -- ADI Inc. (Aerodynamics Inc.)

ADI Inc. (Aerodynamics Inc).
http://www.flyadi.com/

General Information About the Company

ADI Inc. is Aerodynamics Inc., based in Pontiac Michigan (Waterford Michigan) at the PTK-airport. They're a Part 91, 121, 125 and 135 operation based charter company, which basically allows them to conduct a wide variety of operations to meet their corporate customer needs. The company was founded in 1959 by Frank P. Macartney, and was actually started at PTK airport at that particular time, where it presently resides today. Merely a year after its inception, ADI was a representative for piper aircraft, and was becoming relatively well known in the general aviation community during the early 1960's. This was expanded upon further when in 1963, they entered into a long-term association with Beechcraft to become an authorized distributor of aircraft, parts, and maintenance services to operators in the State of Michigan. That's essentially how the company began and grew over the coming years (and decades). As revenue grew, aircraft were added, the customer base expanded, jobs were created and the company sustained decent growth through the years. The acquisition of a competitor (also located in PTK / Pontiac) in 1988 also helped grow the company substantially, having acquired that particular competitors fleet, facilities, services, customers, etc. Recently, ADI acquired an Airbus A319 to conduct domestic and international charters for their customers. The A319, configured in a business-like setting, is comparable to the Boeing BBJ (Boeing Business Jet -- a Boeing 737 configured for long-haul corporate use). Having added the A319 to ADI's fleet will help grow their customer base to include international customers and/or domestic customers looking to travel internationally. In 2011, ADI was sold and subsequently purchased by Scott A. Beale, whom is now ADI's CEO. Presently, ADI still resides in PTK and continues a successful operation there. Under Scott Beale's directive, ADI is working to expand their operations by opening a new location in Atlanta, mirroring their operations base here in PTK.

Fleet wise, they have a large fleet consisting of various aircraft to meet their customer needs. Typically, the Citation Excel and Gulfstream III are often available for on-demand charter based operations, according to ADI's website. However, their aircraft span from King Air's, Pilatus, Hawker's, Beechjet/Beechcraft's, Citation's, Learjet's, and Gulfstream's. Primarily a jet-based fleet, but they retain a few turboprop aircraft (such as the PC-12 and the King Air). The A319 is part of their fleet, too. All aircraft are configured in a corporate-like setting, of course, with various amenities to meet the individual customer’s needs. On a side note, ADI also conducts MRO services on all of these aircraft (MRO meaning Maintenance Repair Overhaul). So, any other corporate company (or anyone whom may have these particular planes) can have maintenance done (heavy maintenance or otherwise) at ADI, as it's something they're certified for, both by the FAA and those respective aircraft manufacturers.

ADI also handles aircraft sales. Having been a long-term dealer for Piper, Beechcraft, and other manufactures for several decades, they're well versed in selling aircraft. They offer services with respect to selling your aircraft, acquiring an aircraft (purchasing an aircraft), and assist first time owners with making purchasing decisions. If you were to use ADI, for example, you could work with them to outline all the amenities and features you want in an aircraft. Perhaps you needed long-range, you wanted at least 10 seats, wifi capability, leather interior, etc., ADI would then take this information and conduct a worldwide search for aircraft that best fit that particular description (the customer's needs). Obviously utilizing such services comes with a cost, but, if you were unfamiliar with buying an aircraft, had no idea what you were doing, and/or simply didn't know where to begin, then this would maybe be an ideal option to look into. Even after finding an aircraft, ADI would help assist you through the entire sales process till the aircraft was fully in your position. A valuable service for the inexperienced aircraft-buyer. Additionally, ADI offers a detailing service (interior and exterior), something that you could use had you purchased an aircraft (and handle this with their sales department as described above), or whether you simply were in town and wanted to have your aircraft detailed at ADI.

A few interesting facts about ADI – Surprisingly, they fly nearly a quarter-million passengers annually. By all means not a small operation, even though they're (in the big scheme of things) a relatively small carrier. Over 205 employees, consisting of flight crews, mechanics, technicians, and support staff -- work for ADI. On average 98% of their flights are on time, featuring 40 average daily departures. They have 7 smaller-subsidiary bases in 6 different states, and surprisingly, have only had 1 majority owner since 1959.

Career Opportunities

ADI actually has several job opportunities available, ranging from pilot jobs, to flight attendants, management, maintenance, and dispatch-related. Various sales jobs are available also. These are all career opportunities available to a management and/or flight related degree earned from Eastern. To list these job descriptions on here would take up pages of information, however a list of all the available jobs (and you can click on the jobs to view their descriptions) is available on JSFirm -- Click Here for Details. Since I’m neither a flight student nor presently flying, the pilot jobs are obviously not available to me. However, considering they're looking for Embraer 145 pilots, it's safe to say it looks like ADI will be adding an Embraer 145 aircraft to their already-large fleet. One of the jobs I’d be interesting in, which is one of the reasons why I chose to write about ADI in this blog, was their flight following job (dispatch). Assuming all goes well and as planned, I should have my FAA dispatcher’s license within the next couple months. Once that's done, I’ll have met all the qualifications for the flight following job at ADI, should I choose to pursue it. The qualifications are that you have to be at least 18 years of age, effective communication skills, read-write-understand the English language, a high school diploma, college degree (preferred but not required), dispatchers license, knowledge of Microsoft Office (word, excel, outlook, etc.) and some customer service experience. The job duties as a flight follower at ADI would be to manage the successful outcome of all flights; customer, flight crew and maintenance coordination per flight operations; ensuring accurate data input per flight following; assisting in data collection reporting and development; and assisting with other ADI managed aircraft on an as-needed basis. This particular job posting can be found Here. Nonetheless, with their long established reputation and good-longstanding status as a corporate aviation company, ADI seems like they'd be a great company to look into, and/or eventually working for.

FAA Reauthorization Bill

Three of the Most Important Functions of the Bill

~Synopsis ~

The new FAA reauthorization bill introduces several new and/or improved functions directed towards aviation. All are important, however -- subjectively, a few seem to be more important than others. Out of all of the new and/or improved functions that are introduced, NextGen would seem to be the one that would have the greatest impact in the aviation industry. Another would be with respect to runway safety improvements, with respect to reducing the number and severity of runway incursions. Lastly, and this was a tough choice, but since it's a current affair, the EU ETS ordeal. I considered alternative fuel research, which I think is highly important, but alternative fuel research is so far beyond the scope of aviation right now, we probably wouldn't begin seeing alternative fuels in mainstream operation for at least another 10-15 years. Yes, there have already been biofuel-based tested flights, but they're just that -- test flights (they were successful, by the way). It's one of those things that's always brought up in politics (all the 'going green' hype), but nothing ever really comes out of it, and the next thing you hear is that we need to 'drill more' (oil). So, while alternative fuel research sounds great, and its part of this authorization plan, I doubt we'll see anything significant for at least a decade or two, maybe more. I think its something that needs to be researched, nor am I negating its importance, but there are other problems in the present that should be addressed. Nonetheless, on to NextGen, which is probably the most important aspect of the reauthorization bill.

1) NextGen

NextGen is the Next Generation Air Transport System, which will generate major improvements in safety, airspace capacity, flow control, efficiency (time and money wise), and various other benefits. It's something that's desperately needed given the projected growth in the aviation industry over the next decade (and onwards). The anticipated passenger-enplanement rate is pretty remarkable, growing 2.4% a year from 2011 through 2031 -- FAA Forecast & Fact Sheet. Doesn't sound like much, but at 2.4% -per year-, US domestic enplanements is expected to grow from approximately 150 million passengers in 2010 to approximately 374 million passengers in 2031. Clearly, more than double the amount of people flying today. With an already heavily congested national airspace system in 2011, NextGen implementation is nothing short of a dire necessity, given the future of the industry. NextGen implementation is already under way as we speak. For starts, RNAV-based departures and approach procedures (SID's and STAR's) are now in effect at several of the nations busiest airports, such as Atlanta-Hartsfield. These RNAV based procedures are one of the fundamentals of the NextGen based system. RNAV refers to area navigation, which allows aircraft (aircraft with avionics qualified for RNAV) to use ground or space (satellite) based navigation aids to assist in point-to-point navigation. RNP, another function of the NextGen system, is RNAV, but also includes onboard performance monitoring and alerting capability. In other words, it's RNAV, but the aircraft's avionics can now inform the pilots if the aircraft can or cannot meet the required performance measures necessary for that particular SID/STAR -- FAA Fact Sheet & NextGen. RNAV and RNP combined are called 'PBN', or 'Performance Based Navigation'. This is the desired objective with NextGen. The whole concept of NextGen in layman’s terms is to cram more aircraft into an already tight airspace system. The best way to do this (safely) is via PBN. If each aircraft could effectively predict, manage, and adjust various components of a flights departure and/or approach to very accurate -- precise standards, more aircraft could be streamlined into an airfield. The less dependence on vectors the better, and hopefully, vectors for departure and approach could eventually be eliminated all together (though this probably won't come for many, many decades from now, till all aircraft and airfields are equipped with PBN capabilities). As evident, NextGen is crucial to the future of the aviation industry, and is probably the most important aspect of the FAA reauthorization bill.

2) Runway Incursions

Runway safety improvements. Big deal here and this goes quite a ways back. Runway incursions are a well known problem in aviation. Historically, the most infamous runway incursion incident occurred over 30 years ago, which was the Tenerife disaster. Tenerife was really an eye-opening experience for the FAA, and subsequently became the poster child for runway incursions for decades to come. More emphasis was placed on new controller-based (ATC) technology than from an aircraft standpoint. The onset of newer computer technology during the 1980's and 90's paved the way for better airfield surveillance capabilities, eventually leading to the development of SMR -- Surface Movement Radar. However, back then, computers were very expensive, and imagine the price tag on computer technology to survey an entire airfield during those years was huge. As such, only major airports were able to afford the technology. It worked and it worked well, as runway incursions rates declined significantly. Keep in mind, this technology was used by controllers. The technology offered the ability to track aircraft movements around the entire airfield, thereby lessening the necessity to rely on visual cues (watching from the tower) and various other human factors. However, at smaller airfields (unable to afford the technology), there was of course no change in incursion rates. As technology progressed, newer incursion technology came about during the 1990's. SMR evolved to ASDE, or Airport Surface Detection Equipment. ASDE was no different than SMR, but now it included vehicular traffic. Therefore, not only could controllers monitor aircraft movements, but they could monitor all vehicles moving about the airfield. Slight improvement, but still substantial. This eventually led to AMASS in 1992, or the Airport Movement Area Safety System. AMASS was ASDE, but with a software program attached to it, which was logarithm based. The logarithm would predict the paths of departing and arriving traffic, and any types of predictions with respect to vehicle movement (such as if the software 'felt' that a vehicle was about to cause an incursion). The logarithm utilized the position, velocity, and acceleration of both airborne and ground-based aircraft, and airfield vehicles, to predict the onset of a potential incursion. If predicted, visual and aural alarms would be presented to the controllers, whom could then take appropriate action. AMASS was tested at San Francisco Intl. in 1992, and worked well, however due to budget problems (the program was $30 million over budget), never became fully operation till 2001 (at SFO, the initial test airport). AMASS went on to be installed at over 30 of the nations busiest airports a few years after the initial -official- installation at SFO. AMASS is still in use today, and has prevented many, many potential disasters in the US (you could research these). AMASS was recently in use with ASDE-3, the 3 simply means the 3rd generation ASDE system (again, newer technology evolves over the years, so they upgrade the system). Think of it as upgrading Windows; from Windows 98, to 2000, to XP, to Vista, to 7, etc. Same concept. SMR to ASDE to ASDE-2, ASDE-3, and now this leads us to the present system -- ASDE-X. ASDE-X is the newest system which is based on AMASS/ASDE-3. AMASS is somewhat of an outdated term now. ASDE-X *is* AMASS and ASDE-3, just the newest version, coined under one term (ASDE-X).

With ASDE-X, now we've come full circle to NextGen (back to my second paragraph on NextGen). ASDE-X is the newest system that is part of the NextGen plan. It encompasses a new feature (not part of AMASS/ASDE-3), called ADS-B, or Automatic Dependent Surveillance Broadcast. ADS-B supports data based linkage (think internet like), both in and outwards (downloading and uploading). ADS-B relies on surface based radar and transponders installed on aircraft and ground based vehicles. It's the most accurate system to date, the present one in use, and is NextGen compatible. Moreover, it uses GNSS (Global Navigation Satellite System), which is the hallmark of ADS-B, and why it's compatible with NextGen. Via the use of GNSS, the system is able to provide the exact coordinates, altitude, speed, and heading identification markers -- via a data link, to controllers. The benefits of this are enormous; precise aircraft position monitoring, elimination of blind spots for controllers and pilots, conflict avoidance countermeasures, complete and total surveillance coverage, and the ability to retain awareness regardless of weather conditions -- Benefits of ASDE-X. Clearly, a major safety enhancement. All said and done, you see how runway incursion technology has evolved, how we've come full circle, how it ties into NextGen, and how it all plays a significant part in the future of the aviation industry.

3) EU ETS -- European Emissions Trading Scheme

Lastly, with respect to the EU ETS (European Emissions Trading Scheme), the EU ETS is a present day factor that was fortunately included in the reauthorization bill. With respect to the reauthorization bill, the reauthorization bill further reaffirms the US's stance on the EU ETS. Congress used this act to further exemplify the US's stance with respect to the EU ETS. Basically, it's just another jab at the EU, and rightfully so. The act specifically stated that the DOT and the FAA were to use "all political, diplomatic, and legal tools to ensure that the EU ETS is not applied to any US registered aircraft and/or US operator". Hopefully such stern terminology, and the inclusion of this terminology in a federal bill, will help aide in the abandonment of the EU ETS for US carriers. The US has felt that the EU should have gone through ICAO with respect to the ETS, and also feels that the EU ETS violates the Chicago Convention. Moreover, they believe that the EU hasn't properly cooperated with foreign entities to address the problem of emissions. Instead, they've taken it upon themselves. Subsequently, including the EU ETS in this bill was done to further address the issue and hopefully help eliminate the EU ETS (in the US's favor). Will it work? Hopefully. We'll find out soon enough.

EU's Emissions Trading Scheme

1) What is the EU ETS? Describe how it works and how it will affect the aircraft flying into Europe.

The EU European Trading Scheme is an emissions based regulatory trading scheme developed by the European Union. The ETS was launched in 2005, working under the guise of a 'cap and trading' principle, hence the name 'European Trading Scheme'. The word 'scheme' is usually synonymous with some sort of illegal activity or scam, but that's not the case in this particular scenario. Instead, it's merely something that encompasses the various aspects (network) of how the ETS works. Anyhow, there's a cap and limit on the total amount of greenhouse gasses that can be emitted. Emitted from whom? Factories, power plants, and other various industrial sectors that emit greenhouse-based gasses. The whole ETS is based on reducing overall CO2 emissions. In the grand scheme of things, it's an environmental project. The cap is something that the EU ETS sets for each individual company. The cap is simply an allowance, saying, 'this is how much emissions you're allowed to emit'. Companies can actually sell portions of these allowances (hence the trading principle) to other companies. So, these caps (and trades) have financial value. At the end of each year, the company uses its allowances to 'pay' (cover) for all of its emissions. If that company exceeds its allowance, they'll be heavily fined. Therefore, this goes back to the trading principle and companies whom shift their allowances to other companies whom expect to emit more CO2. As years progress, the EU ETS reduces the amount of the allowances (or caps), slowly but surely. This is usually done via phases, and its intent is to reduce *Overall* emissions over time.

For the environment, this sounds great and all, that is -- until they decided to include aviation in the mix, beginning in January 2012. That's when everything went awry. Once aviation was included in the mix, it included aircraft that would arrive or depart from any point in an EU country. Therefore, the EU ETS now will affect every airline from any other country that arrives at some point in the EU. The EU ETS operates the same cap (allowances) and trade principles for the airlines. The big strife here is that other countries (i.e. -- the USA, China, etc.) now have to adapt to the EU ETS, despite not being an EU member. Therefore, with respect to aviation, countries from around the world are now dealing with European Union emissions standards, despite having nothing to do with the European Union, other than simply flying there.

The EU ETS will affect the aircraft flying to Europe in several ways. The EU ETS is offering 85% emissions under free permits, therefore permitting airlines 85% of their emissions for free, and they'll have to purchase permits for the other 15%. As mentioned, these permits can be traded as necessary. Aircraft wise, I’m sure most airlines will now be trying to operate the most efficient aircraft into Europe, while dumping the least-efficient aircraft into non-EU member countries, thereby avoiding ETS and using as little as their permit percentage as possible. There's a term for this, too, called 'leakage', where other countries will now experience surging emissions as a result of EU ETS companies moving their operations to those countries. In the case of aviation, moving those less efficient aircraft to operate routes into non EU-ETS countries, and the most efficient aircraft to the EU ETS countries.

You can read more about various aspects of the EU ETS ordeal by clicking here.

2) Why is the US (among other countries) upset about the implementation of the EU ETS? What steps is the US government taking right now in response?

They're upset about it because they're essentially being forced to implement foreign policy into their own countries operations, which is pretty ridiculous. To make matters even more ridiculous, the EU ETS measures emissions standards based on total distance travelled, not just the distance in the EU airspace. Therefore, a widespread complaint is that the EU is extending coverage of their airspace (technically) to encompass the world, by using such measuring practices. A valid complaint. Other arguments state that the EU should only measure the distance flown within the EU airspace itself, considering that is the scope of their authority. The EU ETS refutes these claims and stands by its decision to measure emissions based on the total distance travelled. Therefore, a flight from New York to Paris, France, will have its emissions calculated from the moment it lifts off the ground in New York till the moment it touches down in Paris. Many airlines that travel long distances are the most infuriated, particularly Asian and Australian-based airlines, because they state that due to the longer distances they have to travel (Sydney to London, for example), versus Dubai to London, they'll be paying significantly more for permits than their Middle-Eastern counterparts. Therefore, airlines with closer hubs (closer countries) to the EU benefit greatly on permit costs, while those farther away are going to pay dearly in permit costs to keep up with their allowance.

The US Government has introduced a few bills, such as S.1956, which states that if the DOT determines that participation in the ETS would not be in the public interest, then the bill would prohibit airlines from participating in the ETS. Another bill from the senate, H.R. 2594, is essentially identical to S.1956, was also passed on Oct 24th, 2011. ALPA supports both bills, and support against the ETS seems to span across the entire US aviation industry. The US also passed a resolution to ICAO on November 2nd, 2011, approving many actions that oppose the ETS amongst international carriers that are non-EU airlines. The US has also asked the EU to slow the progression of ETS, or stop it with regards to aviation, so that both the US and EU can meet with ICAO and come to a one-all global approved emissions plan. Though, the EU refused, stating that the ICAO hasn't been effective in reducing aircraft emissions, and told the US to work on a global solution while the ETS is still enforced.

3) What is ICAOs response to the EU ETS?

ICAO is in somewhat of a tough predicament. ICAO is usually responsible for these types of issues, however the EU has somewhat taken globalized energy policies under their own guise, developed the EU ETS, and then began a pseudo-worldwide enforcement of their own policies. ICAO has been somewhat ignored in the process. The EU states that ICAO is ineffective (or not effective enough) in reducing emissions standards and, if someone doesn't like the EU ETS, then they need to come up with an alternative global emissions plan. Until then, the EU ETS will be enforced, according to the EU. ICAO is strongly against the EU ETS with regards to including international carriers (non-EU airlines) from being included in the EU ETS. While they state that there is a need to incorporate a globalized emissions plan, they reaffirmed the importance of their own role (ICAO's role) in addressing global aviation emissions. Essentially, they're saying, look -- we're still here, we're ICAO, let us deal with the international issues. Other than that, EU -- you can stick with your EU ETS, but only for your EU member countries (EU member airlines).

Click here to read more about ICAO's response to the EU ETS.

4) What is your response to the EU ETS?

I'm iffy on the EU ETS. While it sounds like an ideal plan (excluding aviation), it also sounds a bit farfetched (when incorporating aviation). Beginning to charge companies on the premise of emissions as a way to get them to reduce emissions is something that may work on a very-long, spaced-out maybe 30-some year plan, but not something that suddenly goes into immediate effect. There simply isn't the technology to deal with such a dramatic decrease in emissions that the EU ETS demands. Forcing companies to pay mass amounts of money makes sense...if they're using 1970's technology. But, it doesn't make sense when they're using modern equipment, and, that's about as far as technology has evolved. All in all, it sounds like a wonderful money making scheme for the EU. That's probably why they're so adamant about including international carriers -- to make money, because they know they will, and a lot of it. In terms of the EU ETS on a global scale with respect to aviation, that's outrageous, as they're taking on ICAO's responsibility by doing so. Moreover, the way they calculate the emissions (based on total distance), is even more outrageous! So the European Union is charging say, Qantas, to fly from Sydney Australia to Paris France, from the moment they take off to the moment they land; even though clearly 70 some percent of the flight is flown over the airspace of non-EU member countries. That's completely ridiculous. Moreover, the EU won't budge on that, either. If the EU wants to have some regulation over emissions, that's fine, but it must be kept within the confines of the EU member countries. Leave it to ICAO to handle it on a global scale.

5) How do you feel that ICAO should manage global aviation emissions?

ICAO has it right by incorporating ICAO-member countries into coming up with one, widespread approved, globalized emissions plan. That's ICAO's job and something they're working on. ICAO should continue to work on it. Unfortunately, the EU ETS has somewhat taken ICAO's job and made it their own job, mainly out of frustration at the pace that ICAO operates at. However, the EU ETS needs to understand that ICAO deals with over 190 countries, which will obviously take significantly more time to incorporate a globalized plan compared to the European Union. ICAO should work with its member countries to develop a global plan for emissions; one that'll be approved for widespread use and can be voted upon, not sternly enforced without say, such as the EU's ETS.