Coping with aviation industry cycles
nless you have been hiding under that the forecasts range from significant rev-
a rock, it is obvious that the avia- enue loss to contraction and restructuring.
tion industry, like so many others,
is experiencing a “perfect storm” brought Lions, tigers, and bears
on by the combination of rollercoaster fuel It is safe to note that “change and churn”
prices, the sub-prime market meltdown, is the nature of our industry. This is not to
and subsequent credit crunch. It appears make light of the current economic situation,
By Charles Chandler
that the weather is always threatening to be as these times are scary and challenging for
stormy for the aviation industry. both the new hire and the ready-to-retire
The dramatic economic meltdown in grey beards. However, these types of indus-
the financial and housing markets in the try cycles always bring many opportunities
United States and other global economies as well as challenges.
has made a major impact in the market for In the August 2008 edition of AMT, Bill
aerospace products and services, affecting O’Brien wrote a poignant letter to high
all segments of our industry. It appears that school seniors about choosing a career in
throughout 2009, and possibly beyond, the aviation maintenance. In that article Bill
major airlines and the associated regional stated that one thing that he had learned
airlines will continue reducing capacity due in his 45-year career was that “for better or
to the global economic recession and the worse aviation is joined at the hip to the
continued weakening demand for air travel. world’s economies” and that we need to
As a result, the airlines are closely inspect- prepare for and weather these cycles, which
ing all the links in their value chains for is part of being a contributing member of
ways to reduce cost of operations. As tends the free market economy.
to happen, these cost-cutting measures will
start to travel upstream to large and small The Skyway Airlines story
service providers. Skyway Airlines provides an example
Across almost every segment, there is of how the industry can prevail in the face
agreement that it appears the shakeout in of adversity. Skyway began flight opera-
the aviation industry is accelerating and tions in the spring of 1989 as a division of
56 March 2009 Aircraft Maintenance Technology • www.AMTonline.com • www.AMTSociety.org
Phoenix, AZ-based Mesa Air Group. Mesa’s Skyway Both Steve Moyer (director of maintenance opera-
Airlines division operated Beechcraft 1900 Cs and tions) and Steve Llewellyn (maintenance training
provided service to customers at Midwest Express manager) felt all the pieces were now in place for sta-
Airlines in Milwaukee as well as in Rockford, IL. bility and then growth when the economy improved.
In 1994 Midwest Express purchased the Skyway TPG Capital and Northwest Airlines were seen as
division from Mesa. It reincorporated the airline the White Knights that had ridden in to save the day.
as Astral Aviation Inc., doing business as Skyway TPG Capital had the reputation of buying companies,
Airlines. (Astral) Skyway was a wholly owned sub- making changes, and then returning them