The Sequestration of Aviation: A Boon to the Flight Training Industry?

With the dreaded sequester set to take effect today, many Americans are understandably concerned about the effects the looming financial cuts will have on many aspects of the nation’s security and well-being. For those of you who follow aviation, you’ve probably heard dire reports about the impact more than $600 million in FAA budget reductions will have on the country’s aerospace system. Lately, national news programs have been reporting that, should sequestration come to pass, Uncle Sam would be forced to furlough air traffic controllers, shutter control towers, and take other measures that would result in contraction of the national airspace system. Should these forecasts bear fruit, is it possible the flight-training industry could actually benefit?

THE SILVER LINING

As a glass-half-full kind of guy, I try to find a positive aspect in every negative news story. While the government and the airlines might suffer from sequestration, I believe the general aviation (GA) industry, particularly the flight-training segment, has a golden opportunity to thrive as a result of the sequester. If handled properly, the fiscal crisis could be just the shot in the arm to reinvigorate GA.

 

FUTURE PRO PILOTS

While the FAA might need to make cuts here and there, commercial air travel is certainly not going away. Rather than focus exclusively on sequestration, let’s look a bit further down the road. Current legislation requires airline pilots to hang it up at age 65. In the coming years, more and more Baby Boomers will be hitting that milestone and vacating the cockpit. For professional aviation to continue, the industry will need a steady supply of younger pilots to fill the ranks. Where will these professionals come from?

Years ago, the majority of airline pilots came from the military. Over time, the percentage of civilian-trained pilots has grown and surpassed the military supply chain. If sequestration forecasts hold true, the demand for civilian fliers should continue to grow. Half the planned budget cuts are scheduled to come from defense spending, which is forecast to mean a military budget reduction of $50 billion each year for the next decade. In preparation for this financial setback, the military has already announced plans to significantly curtail its flying ops. The Air Force foresees reducing flying hours by 20%, while the Navy expects to shut down four air wings. With fewer military pilots, that means civilian aviators are essential to the future of the airlines. For flight schools, the sequester could potentially lead to a strong increase in demand for civilian flight training.

AN ENTREPRENEURIAL SPIRIT

One of the best ways to avoid the worst of a possible sequester is simply to adopt an entrepreneurial spirit. Though government is typically slow to react to drastic developments, private enterprise is much more adept at adjusting to economic and sociopolitical changes. Case in point, look at government vs. private shipping options. The Post Office has been bleeding billions for several years now. Even with regular price increases, the agency is unable to keep its financial head above water. In contrast, UPS plugs ahead with nary a worry. When fuel prices threatened UPS’s bottom line, the company redesigned its route structure to eliminate unnecessary left turns. It even trains employees on how to walk on icy steps & sidewalks to reduce delays and injuries during the busy holiday season. Through a little innovation, the brown company has removed obstacles while the postal service remains perennially plagued.

In many ways, entrepreneurialism has a natural tendency to filter out inefficiencies and streamline operating practices; a trait that can potentially have a huge impact on the flight-training industry. Despite forecasts of gloom for the entirety of aviation, opportunity is everywhere. Sequestration might be the perfect stimulus to take your operation to the next level.

DEBUNKING SOME MYTHS

While certain aspects of a government sequester will trickle down to GA, the impact will likely be much smaller than many naysayers are predicting. Think about it. Let’s take a quick look at some of your students’ needs.

NEED:

  • Medical certificate
  •  Flight train materials
  •  FAA written exam(s)
  •  FAA Checkride(s)
  •  Aircraft to fly

PROVIDERS:

  • Aviation Medical Examiners (AMEs)
  • Jeppesen, ASA, Sporty's
  • LaserGrade, CATS
  • Designated Pilot Examiners (DPEs)
  • Cessna, Piper, Cirrus, Diamond

Notice that all the providers are private entities? That’s right. Despite the strong FAA oversight of GA, many aspects of the industry still operate almost exclusively through private enterprise. Look at your weather briefings. The FAA has outsourced Flight Service duties to Lockheed-Martin and has utilized DUAT/DUATS providers for over two decades. Though a slowdown in some areas is inevitable, much of the GA experience will continue to function relatively unaffected. Rather than accept defeat, take advantage of GA’s benefits and point out its conveniences to potential customers.

PROBLEMS AND SOLUTIONS

If you’ve read a few reports on sequestration’s potential effects on GA, you’ve invariably noticed a few obstacles that will hinder many flight-training operations. While such barriers won’t all be easy to circumvent, with a little adjustment many flight schools and FBOs can continue with business as usual. Below are a few examples.

Problem:  My airport’s tower will reduce hours or close completely.
Solution: Many GA businesses operate full-time from uncontrolled fields. For towered schools and FBOs, the sequester could give your customers plenty of practice with uncontrolled airport operations.

Problem: Fewer controllers mean fewer ATC services (flight following, traffic reports, etc.), which will reduce safety.
Solution: Several modern GA aircraft are equipped to provide for many of these needs without ATC assistance. These days, new planes come outfitted with GPS, transponders, ELTs, TCAS, BRS aircraft parachutes, and full glass cockpits. In the event that ATC assistance is required, all emergency aircraft will be given priority, regardless of demands on the system.

Problem: FAA staffing cuts will delay the issuance time of pilot certificates.
Solution: After passing a checkride, each airman’s temporary certificate is valid for a full 120 days. If you’re nearing the 120-day mark and still haven’t received your permanent certificate, your DPE can issue a new temporary. With a simple phone call, you can be good to go for another 120 days. In addition, the FAA’s automation of much of the certification process has helped reduce the issuance delays of old.

In recent years, many Americans have preached that Uncle Sam is too big and the country needs a smaller government. With sequestration set to hit close to midnight tonight, a smaller government could lead to big business for enterprising flight-training providers. By touting GA and the benefits of private aviation, the nation’s flight schools and FBOs could stem the declining pilot population and help revitalize GA. Now might be the perfect time for flight trainers to grab the bull by the horns and watch business soar.