Time Air CEO Martin Prazsky on managing light jets in Europe and the demand for charter from European businesses
Time Air opened its doors in December 2001, at a time when the world was still absorbing the impact of the infamous 9/11 terrorist attacks on the Twin Towers. As the company’s CEO Martin Prazsky recalls, much of the preliminary work for that launch actually took place in the week before that fateful Tuesday.
“There is no doubt that 9/11 made it a lot heavier work for us. We started with a piston engine aircraft to build our AOC on and in 2003 we won the contract to manage a King Air 300 for a local owner. That was the start of our aircraft management business,” he explains.
The key to winning that first aircraft management contract was Prazsky’s confidence that the company could generate sufficient charter business to offset virtually all the owner’s operating costs. “The fact that we could take it onto our AOC and put the aircraft out to charter made a very convincing story. We did not do the maintenance on the aircraft ourselves. Our focus was very much on charter and on management reporting to the owner. For maintenance we took the aircraft to Beechcraft Augsberg, which has an excellent reputation for MRO services across the Beechcraft portfolio,” Prazsky says.
After that first management contract Time Air went on to provide services for a range of aircraft for owners located right across Europe, from Croatia, to Spain, Slovakia and the UK. “We managed some 15 aircraft in all over that period, including both light jets and turboprops. It was something of a bumpy ride for us from time to time, particularly when two or more owners decided in the same year, or even in the same month, to sell their aircraft,” he notes.
In 2011 Prazsky became interested in the Nextant 400XTi and started looking at the remanufacturing proposition seriously, with a view to recommending the aircraft to clients. As a result, by May 2015 the company had three Nextant 400XTi’s under management and Prazsky says that Time Air is now in the process of acquiring a fourth for a customer based in the UK, which it will also manage.
“With the Nextants, we have been able to guarantee to the owners that our charter operations will generate sufficient revenues for them to cover the fixed costs of operating the aircraft,” he
comments. That, of course, is a very interesting proposition for any aircraft owner.
In terms of hours per year, this means that Time Air needs to secure somewhere around 400 charter hours per year per aircraft to meet that guarantee. “The aircraft is extremely popular with our charter customers. It is very efficient and economical to run, with a very nice executive cabin, and we have had no difficulty so far in more than meeting owners’ expectations as far as revenue generation is concerned,” he says.
Having four Nextants in the fleet will help Time Air to be very flexible in its scheduling and will mean that owners should be able to fly whenever they require it. “We have not had a situation yet where we could not accommodate an owner, given even on a short call. We can always reshuffle the fleet or use other aircraft,” he comments.
Time Air is currently working towards becoming a Part 145 certified MRO shop on the Nextant 400XTi and Prazsky hopes to have line maintenance in place on the aircraft by the end of 2016.
With four successes in European sales since the first delivery in 2012 Prazsky is confident that the Nextant will do very well in Europe. “I would say that once people look closely at the aircraft and get to grips with the excellent economics it offers as far as operating costs are concerned – plus the fact that it is only around half the price of an equivalent new light jet – the buying decision is very easy for them, assuming they are serious about owning a jet,” he says.
Prazsky makes an interesting point about a major difference in attitude between mid-size European companies and their US equivalents. In the US, he notes, company boards have few qualms about owning private jets for business purposes. European boards are vastly more conservative and their views are also coloured by the fact that Europe is a good deal more socialist in its politics, generally speaking, than the US. This makes European boards very sensitive to what UK academics like to call ‘the politics of envy’. Owning a private jet in Europe tends to be seen by the public as symptomatic of a management team that is indulging itself at the expense of shareholders. As anyone involved with business aviation knows, this view is way off the mark. A business jet is a business tool, first and foremost.
“I do not see corporates buying aircraft of any size in Europe very easily and certainly not mid-sized companies. The owner might buy a jet, but it will be for his private use and for him to put at the disposal of the business if he deems that appropriate. It is a pity, but that is just the way it is in Europe,” he says.
However, there is a real and valuable upside to this mistaken view of business jets, Prazsky says, and that is that while European businesses may be reluctant to buy jets, they have no such scruples when it comes to chartering. It seems that justifying private business flying on a trip-by-trip basis is just so much easier to do! This, he says, makes running a light jets-based charter operation in Europe a viable proposition and one that looks like doing well into the dim and distant future. “It is very good for us, and good for the owners of the aircraft we manage, since it keeps demand for charter services buoyant,” he comments.
“What we also see is that when business owners or business executives fly charter fairly often and get accustomed to traveling in the Nextant, they tend to take the next step and buy the aircraft for themselves.”