Sunday, June 20, 2010

The Three Year Tsunami

It was in the fall of 2007 when the worst case of prosecutorial excess struck the general aviation industry.  But it was the week of June 7, 2010 that the final nail may have been driven into the coffin of one of the most bizarre and saddest stories in general aviation history.

In 2007 TAG Aviation, USA/AMIJC had become the largest, safest, and probably the most highly respected aircraft management/charter company in the United States if not the world. Aviation Methods, Inc. was founded by Roger McMullin, Duncan Higgins and Jim Markel some thirty plus years ago.  Jake Cartwright, who later would become CEO of TAG Aviation, USA was an early partner of McMullin and company.  In 1998 the company was sold to TAG Aviation, a Swiss company controlled by the Ojjeh brothers, who had been early clients of AMI. Therein lay the rub.  The Ojjeh’s were Swiss citizens.  An archaic U.S. law forbids foreign nationals from owning a controlling interest in a U.S. air carrier.

TAG Aviation USA was a division of TAG Aviation, a global company that today operates the London Farnborough Airport and is actively engaged in aircraft management in Europe and Asia.  For almost ten years TAG Aviation, USA operated under an arrangement whereby AMI, which was majority owned and controlled by U.S. citizens, was the air carrier/charter operator for US-based TAG-managed clients seeking Part 135 charter.  The FAA was fully aware of this arrangement and frequently audited the company’s operations, as did the DOT, which conducted their own audit in 2004. In 2007 an aggressive lawyer at the FAA, decided the arrangement was not legal, and despite TAG’s perfect safety and operations record, revoked their air carrier certificate, and assessed the company a $10 million fine, the largest FAA fine in history.

What was left of TAG Aviation, USA’s assets were sold in early 2008 to JetDirect Aviation, a charter/management roll-up which operated under the Sentient Jet card banner and was directed by Sentient executives. This new amalgamation could not handle the influx of more than 100 business jets to their operations, and sold the Sentient charter division in an attempt to salvage the management business under the JetDirect brand. But it was to no avail, as JetDirect declared bankruptcy in early 2009, stiffing employees, customers, and vendors.  A third resurrection, under the name of Wayfarer Aviation, was attempted by Robert Pinkas of Brantley Partners.  Wayfarer was the name of another highly regarded aircraft management company started by the Rockefeller family.  (The original White Plains-based Wayfarer Aviation had been acquired by TAG in 1999.)  This effort, too, failed, and Brantley investors removed Pinkas from any management of Wayfarer.  

Most recently Arcadia Aviation, a relatively new company, has signed a binding letter of intent to acquire “certain assets”, which can only mean the “10 or more” Part 135 air carrier certificate of Wayfarer.  Arcadia acquired two very small FBOs at, Martinsburg, VA, and Monticello, NY.  Monticello is in the Catskill Mountains near the site of the infamous Woodstock Festival held during the summer of love.  Neither of these are centers of business jet activity.  But Wayfarer’s customers could use some love.  We will have to wait and see if this deal closes.  Is this the end of the story?  Stay tuned.

For more on this disaster see General Aviation Tsunami and The Debacle Story Continues.

Monday, June 7, 2010

The Need for Speed

We now live in the fast lane.  Snail mail is now e-mail.  Fast-lanes for commuters are becoming ubiquitous.  High speed rail, if not yet a reality in the US, is on the tip of our tongues.  But with advent of enhanced security and the scrapping of the Concorde, the speed of air travel has declined.

Bill Garvey in his, as usual excellent, editorial in the June issue of Business & Commercial Aviation, Studebaker Time, reminds us that it has been 63 years since Chuck Yeager pushed the Bell X-1 faster than the speed of sound and became celebrated as the first human to do so.  Except for the Concorde, a technological triumph and an economic disaster, as Bill correctly describes this British and French bird, civilian air travel has been restricted to subsonic speed.  He suggests that a business jet may be the first to make supersonic travel possible in the next ten years.

Behind Yeager’s well-known tale of his famous flight in the X-1, there is a little known story about a man who may have reached the other side of the “sound barrier” before Yeager.  There is substantial evidence that George Welch, a civilian North American Aviation test pilot, exceeded the speed of sound in an XP-86 the week before Yeager did.  My good friend Al Blackburn’s book, Aces Wild, the Race for Mach 1, tells the story of pilots who explored this unknown region of flight in the Mojave Desert in the fall of 1947.

George Welch was an Army Air Corps fighter pilot who shot down at least four Japanese aircraft as they attacked Pearl Harbor.  Some records say that Welch should have gotten credit for six kills that awful morning, but there were no gun site cameras to record the action.  George would have needed only one camera as one gun jammed.  He decimated the enemy aircraft with only half of his weapons!

After the World War II, Welch joined North American Aviation, the company that designed and built 17,000 T-6 Texans.  Almost all military pilots in the 40’s and early 50’s received basic training in the T-6.  The two most successful combat aircraft developed by North America were the P-51 Mustang and the F-86 Sabre.   The latter was the first swept wing jet fighter and dominated the sky during the Korean War.

While test flying the XP-86, Welch would routinely create a ba-boom over the famous, or infamous, desert watering hole, Pancho’s.  All the while Bell engineers and Yeager were furiously trying to get the X-1 in flying condition.  The X-1 was a single-purpose rocket ship that could not take off by itself, but was carried aloft by an Air Force B-29 bomber.  The government had spent millions on the X-1 trying to prove supersonic flight was possible despite the fact that Nazi V-2 rockets exceeded Mach 5 thousands of times years before.  Stuart Symington, Secretary of the Air Force, determined that the V-1 should be the first over the Mach 1 line, directed North American Aviation to keep the gear down on XP-86 test flights.  Welch ignored the orders, proving there was no such thing as the Sound Barrier.