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Tue, Oct 24, 2006

Pelton Calls for Continued Euro Government/Industry Cooperation

Wants To Allow Further Euro-Business Aviation Expansion

Business aviation in Europe, thanks to strong economic factors in recent years, will continue to grow as long as suppliers, governments, and service providers continue to work together on issues such as airport access and operational regulation, according to Jack Pelton, chairman, president and chief executive officer of Cessna.

"The time is clearly ripe for our industry to fulfill its promise and capitalize on the current positive climate for expansion," Pelton told a lunchtime gathering of the prestigious Aviation Club of the United Kingdom. "Provided that its needs and differences are accommodated by regulators, business aviation will continue to grow at a manageable pace and complement the work of other air operators."

Pelton said business aviation traffic in Europe continues to grow at near double-digit rates in terms of flights, aircraft and passengers. But the myths of "a Jetson-style future with an entry level jet in every driveway" and declining airline traffic due to business aviation do not hold up as fact and should not be used as a foundation for increased government regulation.

"There remain pockets where the real facts and benefits of business aviation are not understood," Pelton said. "As a result, we sometimes see misguided decisions to curb access, taken by people who equate us with noise, congestion or inconvenience."

Pelton also took issue with critics who claim business aviation siphons passengers from commercial airliners. He said only 30 percent of business jet departures from European airports in 2005 were from airports with 100 or more daily departures. In other words, most business aviation flights are between smaller airports with limited or no airline service. It is not unusual, he said, for business fliers to use on-demand travel in conjunction with scheduled airline travel.

"The fact is, business aviation users are also the biggest users of the airlines," Pelton said. "Proof, if it were needed, can be seen in the sustained premium traffic growth, and overall historic passenger volumes, that airlines have experienced over the past 18 months, which coincide with the upward trajectory of business aviation."

The growth of the market is a result of both the strong economy in Europe and the changing face of the business traveler, Pelton said. More businesses across Europe are seeing benefits and cost savings through on-demand air travel, while technology and increasing competition among providers is opening it up to a larger slice of society.

Despite the growing global reliance on business aviation due to its efficiencies and cost-savings, there are factors, some specific to Europe, which could work to suppress it.

Raising operating or airport access fees for business jet operators to put them on par with commercial operators could have the effect of pricing business aviation out of the market. Pelton said this is evidence of a poor understanding of the finances of business aircraft operators and their value "as part of a diverse transportation network."

Part of the solution, Pelton said, is the development of business aviation centers away from congested hub airports such as the new development at Farnborough (FAB/EGLF).

"We need to see similar facilities appearing elsewhere in Europe to address any exodus of business operators from larger airports," Pelton said. "In the meantime, we need to ensure that business operator interests are understood."

Pelton praised the work of the European Business Aviation Association, the British Business and General Aviation Association, the European Aviation Safety Agency, and the national regulatory agencies in maintaining security within the industry, another key issue for the future.

FMI: www.cessna.com. www.cessnacommunications.com/uploads/Speech200906.pdf

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