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Corporate Jet Business Struggles With Bad Image

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Corporate Jet Business Struggles With Bad Image

Corporate Jet Business Struggles With Bad Image

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STEVE INSKEEP, host:

Fewer corporate jets have been flying lately. Executives are using them less. And while it may be hard for us to shed a tear over all those struggling CEOs compelled to fly commercial, the people who make and fly corporate jets say it's hurting them too. They say politicians undermine their industry by attacking the jets as a symbol of corporate excess. For our series Troubled Skies, NPR's Peter Overby begins at Dulles Airport outside Washington, D.C.

Unidentified Man #1 (Radio Operator): Landmark Aviation Dulles…

Unidentified Man #2 (Pilot): Thank you, sir, Beechjet in range, 20, 25 minutes from parking. We have three passengers and…

PETER OVERBY: A radio operator at one of Dulles's two private air terminals and the pilot of an inbound business jet. Monday afternoon I watched with John Meehan, Landmark's manager at Dulles, as a Cessna Citation rolled up. The cabin door popped open. We saw a half dozen business people climb out, two of them talking on cell phones. They all walked toward the private terminal.

Mr. JOHN MEEHAN (Landmark Aviation): We've been here, what, about two minutes? Now the bags are loaded, they're walking through, they're going to be in their cars, gone, in five minutes.

OVERBY: Which is exactly the point of having a business jet. But the industry is hurting, in many ways worse than ever before.

Mr. MEEHAN: People are genuinely afraid for their jobs.

OVERBY: Meehan has had to lay people off and he has friends around the industry who've been laid off. Business aviation goes through cycles. An analysis by JPMorgan says that corporate profits peaked in 2006 and corporate jet deliveries peaked in 2008 - right on schedule.

Then the recession dried up the credit needed to buy new planes, as well as the commerce to justify so much business travel. But Meehan and others say there's a third factor.

Landmark at Dulles gets a lot of travelers headed to Capitol Hill or federal offices downtown. Meehan says traffic is off 25 percent from a year ago.

Mr. MEEHAN: We're hearing stories that people are very concerned about flying to Washington because of the potential for being targeted by the media and the politicians.

Unidentified Man #3: The hearing will come to order.

OVERBY: The three Detroit car company CEOs last November, asking for a $25 billion taxpayer rescue - California Congressman Brad Sherman took them in a different direction.

Representative BRAD SHERMAN (Democrat, California): I'm going to ask the three executives here to raise their hand if they flew here commercial. Let the record show no hands went up.

OVERBY: Sherman wasn't the only one. In February, President Obama said bailed out banks should show restraint.

President BARACK OBAMA: When it comes to executive compensation - not using the money to charter corporate jets when they're not necessary.

OVERBY: So when the government rescued GM and Chrysler, the companies had to close their aviation departments. Congress almost took the airplanes away from Wall Street and the banks in the TARP bailout. The White House pushed Citigroup into canceling a new jet.

Even companies that don't get a penny from Washington are dumping their planes. Used corporate jets are a glut on the market.

Mr. MIKE BOYD (Aviation Industry Consultant): You have a congressional and government jihad.

OVERBY: Mike Boyd is a well-known — and plain-spoken — aviation industry consultant. Here's how he would handle the politicians.

Mr. BOYD: You call up Congressman Snort and say, Stop denigrating my industry and stop lying about it. These are not tools of the devil, these are not tools of evil. Business jets are a very important asset for my company.

OVERBY: Ed Bolen is president of the National Business Aviation Association, for users of business planes. He wanted to hear an explanation from those Detroit auto executives - you remember them - and it would go like this: The cabin of a private jet may be lavish, but it's an office. A CEO can keep working and he can do maybe three meetings in three cities in one day. Bolen says that companies are canceling jets, canceling them out of fear.

Mr. ED BOLEN (National Business Aviation Association): If business aviation makes sense — and it clearly did when they ordered the airplanes — then it makes sense to move forward and keep those planes.

OVERBY: All of the industry's flagship companies — Gulfstream, Hawker Beechcraft, Dassault and Cessna — have cut production and jobs in this country. Paul Feldman oversees lobbying for the General Aviation Manufacturers Association.

Mr. PAUL FELDMAN (General Aviation Manufacturers Association): Just among the GAMA members, we have about 144,000 employees represented - U.S. employees. We've already lost about 12,000 jobs over the past six months.

OVERBY: So the two associations tackled the problem the Washington way: with an image fix. The No Plane No Gain campaign includes an ad tailor-made for the Sunday talk shows.

(Soundbite of commercial)

Unidentified Man #4: What if one industry could generate millions of manufacturing and service jobs right here in America, one industry offering hope and economic opportunity to small towns?

OVERBY: But on Capitol Hill, nobody is embracing the image that corporate jets have right now. Minnesota Democrat James Oberstar, chair of the House Committee on Transportation, says too many planes have been misused.

Representative JAMES OBERSTAR (Democrat, Minnesota): Where corporate executives use the company aircraft for personal business, I think that rubs the public the wrong way.

OVERBY: And Oberstar is one of business aviation's best friends in D.C.

Peter Overby, NPR News, Washington.

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