Let's talk about the current situation in the business aviation industry and development opportunities during the pandemic with Alexandar Simic, Chairman of the Board of Directors of FTC Group
Let's talk about the current situation in the business aviation industry and development opportunities during the pandemic with Alexandar Simic, Chairman of the Board of Directors of FTC Group, a Swiss company well known in the Russian market.
At the beginning of the conversation, I would like to ask you what is FTC Group today and how do you see the company tomorrow?
FTC Group is a young, dynamic, and enthusiastic company with a multinational team. It is unique because it combines the culture of Western and Eastern Europe. And I find that this is our core value. In other words, our main value is our people. FTC Group brought together a team of the best people in the industry who share a common vision, goals and priorities.
We do not aspire to compete with the biggest players on the business aviation market, and don’t follow someone’s role model, but we are trying to become a role model for the future new players on the market.
We currently operate 8 aircraft, and I see the future of the company like having 12-15 airplanes in management. This will be a consistent, controlled growth. We wouldn’t like to grow just to say “look, we are growing big”, losing the quality and our control over the business.
How do you assess the current situation in business aviation?
Based on current press releases and statements from some business aviation operators, it may seem that business aviation is booming at the moment. This is only partially true. After all, business aviation was also largely affected by the pandemic, and throughout the summer season it was recovering from the dramatic decline. Obviously, it will take another year or maybe even two to arrive to figures of 2019, which was a quite successful year.
How has customer demand changed compared to “normal” times?
It would be wrong to compare «then» and «now» because pandemic itself is not a normal situation. All companies had to to urgently find their new role and position in this situation. A lot of extraordinary procedures were required to maintain not anymore just a safe and secure flight, but also a healthy flight!
Did customer preferences change in the choice of the aircraft type?
This is a good question. Now people are looking for affordable means of transportation. They would like to charter a plane no matter of the cabin size, but looking for the better cost.
What are the main challenges for the business aviation during COVID-19 pandemic?
The main challenge for today is the restrictions for flights in most countries. It really affects, first of all, flight departments because flight crew cannot reach the goal minimums of required landings within certain period of time to maintain license currency. In addition, there is also a drop in passenger traffic, which is very tangible. And the cost of operations is increased because more personal protective equipment and procedures are required for both crew and passengers.
The ground time between flights is much more extended now because of required disinfection of the cabin for each flight.
Is it possible to develop the company during the pandemic, or are you trying to keep at least what you have?
The pandemic, of course, surprised us as well. But we were mentally prepared for a crisis or something like that. So, I have to say that we didn’t make any layoff of staff, no cuts of salaries and required payments. When it became obvious that pandemic will be followed by recession, we, as I said before, were ready for that. So, we thought that we can overcome the crisis with no losses, but with a new acquisition!
We have decided to make the acquisition of Swiss Executive Aviation company, which was a reputable company on the Swiss market, and to integrate it into our Group. After successful acquisition we rebranded it. Now it is FTC Jet Management. It has perfectly integrated in our group because this company was well known for management of mid-size jets like Cessna Citation XL, and up to Embraer Legacy 650.
What will clients get as a result of Swiss Executive acquisition?
The main advantage is that we can expand our network and combine capabilities, which is good for both our clients and also for former Swiss Executive Aviation clients.
What services do you plan to develop in the future?
We are constantly thinking of how we could provide more services to our clients. Currently, we have CAMO approval from San Marino and Cayman Islands aviation authorities. One of the things we plan to establish is the full CAMO, not only for FTC customers, but also for third parties.
Another one thing which we think about is to enter the brokerage market. We have some recent experience in the aircraft leasing and purchasing.
And the third opportunity I personally see is to offer some kind of consulting and training services not only for operational staff, but also for management in terms of aviation safety and security. And some management courses which I developed and implemented while teaching at universities.
What type of aircraft is most interesting to buy on the secondary market now?
It’s a bit tricky question because the market nowadays is really changing rapidly, but if I have to point to some specific aircraft which can fit the most demanding requirements it could be Cessna Citation Excel. It’s a very required jet. And also, Legacy 650, which is size-wise and price-wise, good match for clients’ needs. But... It really depends.
I need to underline, this is one of our strengths, we successfully cooperate with major aircraft manufacturers and also with aircraft brokers. So. We can assist our clients in reservation of the production slots, or to find the ideal aircraft on the market.
To sell or to buy? What is the best way to deal with a jet right now?
It’s the same! Pandemic really affected the aircraft owners, which are maybe trying to get rid of the assets, which can be costly at the moment, but there is also a number of people who can now realize that they maybe need to have their own business jet. So, I would say that now it’s a good moment for both selling and buying.