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June 2006

TEN QUESTIONS FOR PETE BUNCE
A year on the job for GAMA’s president

It’s been slightly more than a year since the directors of the General Aviation Manufacturers Association (GAMA) tapped a retired U.S. Air Force colonel to become the fourth president of the group and the second with a military background- complimenting his background as a general aviation pilot. But there hasn’t been much of a honeymoon period for GAMA president Pete Bunce- particularly not with some of the issues that emerged during his first 12 months in his new post.

A high-visibility incursion by a light plane early in his tenure brought unneeded publicity to the community of private aviation- and unwelcome attention – again – from security authorities and lawmakers who appear to believe general aviation is a threat to Americans.

A high-pressure campaign by the airline industry brought a renewed threat of user fees at a time when private aviation was experiencing a welcome rebound. With the Air Transport Association push aided and abetted by a Federal Aviation Administration that sometimes seems to only acknowledge commercial aviation- the threat of user fees appears the most tangible it’s been in years.

Elsewhere- airline and regulatory interests seem ready to use predictions of the imminent boom in Very Light Jets as more 'evidence' of the need for a new funding mechanism and a new way of allocating airspace resources. Unacknowledged by these voices is the goal of these new jets – to avoid those airports favored by the airlines and preclude the delays and inconvenience of using those airline-saturated terminal areas.

If ever GAMA members had the right to be concerned about their place in the world- the past year has brought plenty.

But from all accounts and observations- leadership at GAMA has not been among those worries – in large part because Pete Bunce quickly demonstrated that 'he gets it-' as one board member put it.

No divided loyalties or attempts at weak compromise came from GAMA in the face of these and other challenges. Instead- Bunce seemingly took to the job with the enthusiasm of the true believer and with the strength of a man confident in his convictions. Credit a youth spent learning to fly private planes for at least part of Bunce’s spirited embrace of issues important to GAMA.

Bunce quickly immersed himself in his job- undertaking a marathon series of visits to members’ headquarters- sampling their wares and listening to their concerns. He also signaled GAMA’s intent to continue working in alliance with other groups representing general aviation- in particular with the National Business Aviation Association- headed by his predecessor in the GAMA post- industry veteran Ed Bolen.

So it’s with the benefit of that first year and the 20-20 hindsight that only time can clarify that World Aircraft Sales Magazine asked Pete Bunce to sit for his second 10-questions interview as head of GAMA.

We caught up with Bunce shortly after GAMA released its first-quarter report for 2006- showing record billings and strong growth in deliveries. At the same time- the general aviation community continued its spirited counter-assault on the complementary user fee pushes by ATA and FAA- and we were at the start of the busiest flying season for general aviation.

WAS: With the hindsight that can come only from time- can you describe for our readers how you view your first year as president of GAMA: exciting; challenging; frustrating; scary; all of the above… or with your own choice of adjectives?

Bunce: Dynamic. I quickly realized that no two days at GAMA are the same and that makes coming to work interesting and enjoyable. We are constantly faced with issues that encompass absolutely every aspect of GA. These issues provide both challenges and tremendous opportunities to make flying safer and to help more people realize their dream of owning or flying their own airplane.

WAS: Last summer you told us that as the executive of an association representing general aviation- one of your jobs was to educate the public and politicians who sometimes misunderstand our community and how we fit into the world. You also named as one of general aviation’s biggest challenges 'Overcoming the negative perception of private aviation by some segments of the public; both from a safety and security perspective.' How have you addressed those challenges in the past year?

Bunce: Educating policy makers and the public is not a small job- but our board members have spent an appreciable amount of time doing just that. They have worked as a team to enlighten our decision makers to the challenges that GA faces. Our member companies also work closely with GAMA to educate the public as to how critical GA is to industrialized economies and how essential it has become to businesses- both large and small. And this is an important point to emphasize. The national press continually likes to target what they perceive as privileged use of corporate aircraft- but the reality is that there are approximately 9-500 business jets flying in the U.S. today- as compared to 165-000 piston aircraft. Over half of the piston flight time is for business purposes. If you take potshots at business aircraft- you are sniping at thousands of small businesses using airplanes to create jobs and keep our economy growing.

WAS: Although we didn’t directly address this last year- we both knew of the ATA’s renewed push to convince Congress to change how the FAA funds and controls ATC. In the past six months- ATA’s efforts have drawn comments labeling them the most-onerous- most-threatening push yet to establish a fee-for-service ATC system and eliminate the simpler excise-tax- based funding mechanism. Do you agree with AOPA’s Phil Boyer- that the 'funding crisis' claimed by the FAA administrator is really a 'myth' and that the excise taxes and Trust Fund mechanisms don’t need the proposed 'fix'?

Bunce: Yes - I absolutely agree with Phil and I am very concerned about ATA’s efforts to shed costs that the airlines themselves drive through the hub-and-spoke system onto GA. This is a blatant attempt to cure their financial woes by making GA- which is only an incremental user- pay for a system that is built to service the airlines. Even worse- while the airlines are trying to push their costs onto GA- they are attempting to make a case for gaining control of airspace and airports. On Capitol Hill- ATA has referred to some segments of the sky as 'commercial airspace-' as if they own it. These efforts to continually abuse GA’s access rights cannot go unchallenged.

WAS: Many long-time FAA staff tell me that there is an increasingly dangerous attitude among FAA’s political appointees that commercial aviation should be the agency’s biggest concern to the detriment of general aviation. Other agency insiders talk of a 'fix' being in between ATA and the Office of the Administrator to coordinate and collaborate on the user fees argument. Does today’s FAA seem from your perspective to be more interested in satisfying the common carriers than the equally important issues common to business users of private aircraft?

Bunce: I believe that ultimately there is more common ground for cooperation between the airlines and GA than there are issues that divide us- such as the need for a modernization plan that builds capacity for the entire air transportation system. Unfortunately- the pressure placed on the DOT’s budget by the Administration’s drive for deficit reduction pushes the FAA toward aligning with the airlines and their efforts to shed costs onto others through user fees.

WAS: The next two questions look forward at other issues directly related to the potential growth of general aviation. First- 2006 will undoubtedly be the year in which the first two of the long-awaited Very Light Jet category get into operators’ hands – by many forecasts the leading edge of a group that could number several thousand units delivered in less than a decade. What do you see as the upside and downside of this looming revolution in the coming five to 10 years?

Bunce: In my view- there is only an upside to this story. VLJs will be a new way to economically move people around the world and they will become yet another essential business tool. We feel that VLJs are going to open up aviation to an entirely new customer market. At the same time- it is very important for people to realize that these new jets will not take away airline passengers. VLJs will benefit communities currently not served by the airlines and allow people to get off the highways and better utilize their time and resources. Although the VLJs’ success will not be dependent on the air taxi concept- the unknown is how quickly the air taxi market will materialize. If you listen to ATA or the FAA- they want you to believe we will wake up some morning very soon and VLJs will be 'darkening the skies.' Everyone in this industry knows that this is hogwash- but they are using this Chicken Little tactic to sell their user fee initiative.

WAS: Continuing our look ahead- in the past 13 months no fewer than 34 new designs have won FAA approval as Light Sport Aircraft and about 500 new pilots have won the new Sport Pilot certificate created at the same time. With a VLJ revolution at one end of the community- an LSA revolution at the other- and record sales among the GAMA companies in between- is general aviation poised for another growth period like the one seen in the 1970s?

Bunce: Even with our great sales figures- it would be very hard to get back to the numbers we saw in the 70s. For example- in 1978- the US alone shipped 17-811 GA airplanes. In 2005- 3-580 GA airplanes were shipped worldwide. With that said- we are delighted that more and more people are being able to own their own airplanes. We expect our growth to continue- but the fact remains that even with strong sales figures- GA operations in the US last year decreased by about two percent from 2004. There is no doubt that LSA has created new opportunities to fly and has provided a great avenue for people to enter the aviation marketplace. We are very supportive of the efforts that both EAA and the FAA have made in this arena. Across the entire spectrum of GA- we are seeing cutting edge technology being introduced into airplanes at levels never before seen. To bring safer and more efficient products to the marketplace quickly- it is absolutely essential that our products get certified in a timely manner. GAMA places a lot of importance on FAA-industry partnerships to maximize certification resources.

WAS: Speaking of the growth in GAMA numbers- to what do you attribute such strong sales at a time when so many other economic questions seem muddled – for example- rising fuel prices- higher interest rates- lower real income?

Bunce: Despite the factors you mentioned- more and more businesses are relying on aviation - both GA and commercial - to expand their reach domestically and internationally. Time is money and business aircraft- whether they are pistons- turboprops- corporate jets or airliners- all facilitate market accessibility. Associated with this is the fact that the technologies we are building into cockpits- especially within the piston market- has made flying even safer- easier- and more reliable. I believe that if you drive a car competently and operate a computer comfortably- you can easily become a pilot. I only wish that more people took the opportunity to experience freedom of flight.

WAS: Do you see any clouds on general aviation’s horizon that might thwart the growth that seems in the making?

Bunce: As I touched on- one of the biggest threats is the lack of a comprehensive modernization plan for the entire system. There has been a lot of rhetoric about running the FAA like a business- but no business would pursue investors or attempt to secure financing without producing a coherent- long-range plan. Similarly- there is no logic in trying to put a price tag on modernization without telling the users of the system what they can expect to get for their contributions. We hope that Congress insists that all agencies in government work cooperatively and expeditiously to produce this plan before we just go throw a lot of money at the problem. Another challenge is with the IRS’ interpretation of the statute that singles out GA with tax rules different from other forms of business transportation- like a company car. Punitive IRS guidance could actually create a disincentive to purchase new aircraft and we are working with Congress to help clarify their intent to the IRS on proposed regulations. And of course- I could not fully answer this question without mentioning user fees. This threat comes not only in the form of fees imposed by flying within the system- but also fees imposed on the certification of new aircraft and aviation products.

WAS: During our last interview you mentioned that you were getting in some aerobatic training and working to figure out how to deal with the challenges of flying around the National Capital area with the Air Defense Identification Zone. How are you finding the challenges of flying in and around the ADIZ environment?

Bunce: Unfortunately- the challenges of flying around DC haven’t changed; however- we have faith that TSA Director Hawley is diligently working on improving the accessibility and flexibility of airspace with a sound risk-based approach- not only here in DC- but around the entire country and with his European counterparts. GAMA- along with our sister GA associations- are appreciative of his hard work. Additionally- the work by both AOPA and EAA on ensuring that the ADIZ does not become permanent has been both timely and well-orchestrated. GAMA will continue to support their efforts in every way.

WAS: If Pete Bunce could wave a magic wand and solve one issue challenging the general aviation community- what would that issue be – and what would the solution entail?

Bunce: That the public and the executive and legislative branches of the US government- as well as the European Union- understand the absolute vital contribution that aviation makes to their economies; and through that recognition- the call for robust taxpayer investment for the modernization of the air transportation system worldwide would intensify.

WAS: As always- Pete- thanks for your time and your thoughtful insights. Good luck on Year Two!

Pete Bunce and the rest of his staff can be contacted through GAMA offices in Washington- D.C. General Aviation Manufacturers Association 1400 K Street- NW- Suite 801- Washington D.C. Tel: +1 202-393-1500


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