Cirrus’ SR22 GTS – the sports car with wings

Published by Nicholas Combes

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Sleek, sexy, sporty.

No – not me. Just a few generic words to describe Cirrus’ impressive contribution to the modernisation of light aircraft.

But it is more than just a plane. The SR22 GTS is like a sports car with all the added extras. For just over half a million dollars you can buy this GTS version, which comes with a list of amenities that wouldn’t look out of place in an auto dealers brochure,

  • Airbag Seatbelts (Front Seats)
  • Single Movement Power Lever
  • Advanced Wheel Fairings
  • High Performance Brakes
  • Tubeless Tires
  • Surface Illumination Lights
  • Spectra™ Wingtip Lighting
  • 60/40 FlexSeating™ – Seats up to 5
  • USB Power Ports
  • Standard Leather Interior
  • Tinted Windows

Now, in the brokering world, it is not uncommon to be able to fly on empty aircraft as they position for your clients. This week I was fortunate enough to hitch a ride from Ft. Lauderale Executive (FXE) up to Palm Beach International (PBI), with Tampa Bay Aviation’s brand new Cirrus SR22 GTS.

Admittedly I assumed this was just going to be another general aviation type flight.

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The SR22 GTS with cockpit doors open – courtesy of Tampa Bay Aviation

The first thing I noticed were the Lamborghini style doors. Whether they had merely been left open to keep the cockpit cool or not, it stirred that same excitement you feel when a hyper car passes you on the street.

A few selfies later and I was harnessed in with my pilot Josh beside me.

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Selfie with cliche aviators – courtesy of me.

The Cirrus Perspective+™ by Garmin® Cockpit is seriously simplistic. Two 10” LCD screens mean no more clutter of analogue instruments. Flashed up they prove just how efficient the team over at Garmin have managed the information.

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The Cirrus’ simplistic glass cockpit – courtesy of Tampa Bay Aviation

 

The Continental IO-550-N 310 HP started when commanded. No splutter and stall like the older generation engines. We immediately turned the air conditioning on as it was quickly becoming a furnace in there thanks to that South Florida sun. A few words with FXE tower, a flash of the taxi light and we were rolling.

It was at this point that my pilot offered for me to fly it. Even though I have infinite hours playing flight sim (don’t hate – all avgeeks understand this) and around a dozen hours flying right seat, I am NOT a pilot. My pilot reassured me that with having over 3000 hours of students trying to kill him, he was quite comfortable with me at the controls.

Taxiing wasn’t too strenuous. The Cirrus has differential brakes, which means that a tap of the right or left brake kept you on center line.

At the runway threshold we came alongside a DA-20 and its student doing an engine run up (revving the engine to get the oils up to temperature). The Cirrus rides higher on the ground than most light aircraft. This gave us a height advantage when taxiing, and it wouldn’t be right for me not to mention that I felt a little smug looking down on this student (who is far more qualified than me) and his inferior aircraft.

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A Diamond DA-20 – courtesy of Diamond Aircraft

The take-off was straight forward … The SR22’s large and simplistic throttle meant I didn’t have to fumble around, whilst focusing on not veering off of the runway. The climb out was when the aircraft’s power really could be felt. In an instant (almost) I was leveling off at 1000ft with downtown Ft. Lauderdale just off the nose.

Yaw damper on to stop the natural swaying of the aircraft. There is no trim wheel at your feet or coffee grinder tab on the roof. The trim was a humble button on the yoke which made level flight easy.

At 180kts (this is quick) I pulled the power back and was already turning north to follow the coastline. Two buttons later and the plane was flying itself thanks to the GFC 700 autopilot. It should be noted that most general aviation aircraft cruise at around 80-100kts.

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Flying north towards Palm Beach with GFC 700 Autopilot.

Another few photo opportunities to be had and the auto pilot was turning us west to join a right base approach into PBI.

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Palm Beach with an uncharacteristically empty I-95.

Descent, approach, flaps and an average landing later, we were on the ground and marshalled into Atlantic Aviation. Even though dominated by the ultra-long range private jets, the SR22 did not look out of place. If the heavy jets are a rich persons’ RV, the SR22 is the sports car they tow behind it.

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On the ramp with Atlantic Aviation at PBI.

At $450 per hour, the SR22 is seriously cost effective for charter. For comparison a King Air turbo prop is around $1200 and a light jet over $2000. The well designed leather interior still gives it that wow factor that private jet users expect.

For the businessman that needs to cover relatively short distances quickly and cost effectively, this is the aircraft for you.

South Africa’s ‘comic sans’ airline and the corruption behind it all…

Published by Nicholas Combes and Mitchell Brooks (www.brookslegal.wordpress.com)

In late 2016 it was announced that SAA, SA Express and Mango airlines would undergo a parent take-over. The merger is said to be overseen by an American 3rd party organisation, Bain & Co, a management consultant firm. The reported fee agreed for Bain’s oversee was in the region of R12 million.

From an operational aspect, Mango is already operating under SAA’s AOC (Air Operating Certificate) and its’ fleet is maintained by SAA’s technical department. This means that no real change would be felt across airline operations.

Mango is a 100% subsidiary of SAA, meaning that SAA holds the entirety of Mangos’ shares. The financial integration should be straight forward. But it is the company restructure that interests us.

With that said, SAA does not stand to reap profits greater than the existing dividends it already receives. I am no tax expert but, if anything, SAA may be attempting to avoid dividends tax by up to 20% by becoming one single entity…

But it is admittedly difficult to see why a state owned entity would take on the cost of this merger, simply to avoid the same tax that it enjoys the benefit of!

For those even remotely aware of South African Airways’ financial history, you will remember that the state airline has already been rescued by various state bail outs (thanks taxpayer). South African Airways still reported a 2015 loss of R5.6 billion or $485 million. Mango is currently the only profitable subsidiary of the 3 merging companies. (It has done well to remain so against the might of Comair’s low cost subsidiary, Kulula.)

The merger proposes a streamlining of SAA as a parent company to maximise profitability. But if Mango is doing well shouldn’t they be left alone to continue just this? If the SAA board cannot return a flagship carrier to profitability, then taking on another two airlines is not going to make their jobs any easier. Adding two bad eggs with one good egg still makes a crappy pancake.

Mango’s relatively small yet successful operation is not going to be offering any lifelines for SAA parent. SAA is a sinking ship that ultimately threatens to pull Mango down with it.

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A South African Airways A340-300 aircraft.

So what really is the motive for this merger?

Let us back track to the restructuring of the boards of the entities and simplify things. As it stands, an unsuccessful SAA has a board of directors, with its highly criticised Dudu Myeni as its chair. On the other hand, a successful subsidiary, Mango, has its own independent board of directors. What should be noted is that, notwithstanding the MOI of the Companies, the Companies Act 71 of 2008 requires the shareholders of a company to elect a minimum of 50% of the board. This means that SAA parent already has the power to appoint the majority of its own new board.

Based on the endless corruption allegations and financial short falls of SAA, is it not plausible that the proposed merger serves the purpose to concentrate power towards one individual, whose purpose to date has clearly not been the success of a company, the chairperson – Dudu Myeni.

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SAA’s controversial chairperson, Dudu Myeni. (Courtesy of Mail & Guardian)

Another prominently possible reason for the merger would be to restructure the ownership of the fleet. SAA has found itself being investigated by the Competition Commission on more than one occasion. State entities are in fact the most frequent transgressors of the Act, which has caused quite a lot of speculation surrounding its possible amendment to relieve state entities all together. Furthermore, SA President Jacob Zuma did hint towards this amendment at SONA 2017, which indicates that there is certainly an intention for the state to relieve itself from this Act to some degree.

This may seem quite deceptive, as the merging of the entities may be for the purpose of avoiding the red tape surrounding the Competition Act. In June 2016 SAA conceded to sub chartering aircraft to SAA at discounted rates. In fact, the SAFAIR CEO indicated that SAA would have been subsidising almost 40 percent of Mango’s costs through the arrangement.

Of course such an arrangement drew attention from Mangos biggest rival Kulula, who laid a complaint to the competition commission on grounds of collusion. Unfortunately the channel chosen by Kulula was slightly flawed and perhaps would have been better suited under a predatory pricing argument.

The problem with pursuing the horizontal collusion argument is that the relationship between SAA and Mango is distinctively more vertical than horizontal because, as mentioned earlier, SAA amounts to a supplier of aircraft to its 100% wholly owned subsidiary. It would be quite difficult to argue that SAA competes with its sub in the domestic, low-cost airline market. Arguably, that is where the collusive approach falls flat.

A more reasonable approach would be to argue that SAA was abusing its dominance in the domestic airline market, gained by means of historical state funding, by sub chartering aircraft (a service) to its subsidiary at prices below their marginal or average variable cost.  Furthermore, the only intention that can reasonably be inferred from this arrangement is that SAA, and by implication Mango, sought to remove Kulula from the market – hence the term predatory pricing. Think about it, why else would a bleeding parent company sublease aircraft, at a loss, to a succeeding sub?

The point is, if mango and SAA become one entity they no longer need to formally lease aircraft between each other, meaning that Mango benefits from the use of the aircraft at low costs which allows it to undercut Kulula and squeeze their margins, eventually squeezing them out of the low cost market. The biggest effect of the restructuring is that without a leasing arrangement the Competition Act is circumvented.

However, the merger will have to pass the muster of the Competition Tribunal in order to merge and I am quite hopeful that the merger will be rejected on the grounds that it would lead to extremely anti-competitive consequences in an already struggling market.  One could say the merging parties have exceeded their maximum take-off weight (“MTOW”), and even if cleared would unlikely reach their Vspeed “rotation speed.”

Ultimately, there are only two parties that may benefit from this merger, Dudu Myeni and allegedly a number of SAA pilots. An anonymous insider has suggested that currently the policies within the two companies are different in regulating the years of experience required to jump to the left seat, with the SAA policy requiring over a decade. The question arises as to whether SAA pilots may demand a threshold more akin to their orange comrades.

Cabin-crew, disarm doors and cross-check”

MAGA: Making ATC Great Again?

By Marion Delano

The release of Donald Trump’s first budget proposal has garnered a lot of attention and examination. The proposed budget takes an ax to many federal program and agencies including the Environmental Protection Agency, State Department, USAID and the Department of Agriculture. The Department of Transportation is another agency that will see it’s budget cut under Trump’s proposed plan. The department would see a 13% decrease in funding from it’s current level this fiscal year.

While the 13% budget cut for the Department of Transportation is jarring, it is not he most controversial part of the Trump plan. No, that right is saved for proposed privatization of Air Traffic Control services within the U.S. Under this plan, ATC would be removed from the purview of the Federal Aviation Administration and spun-off to a new quasi-governmental private corporation similar to Fannie Mae or Amtrak.

The privation of the Air Traffic Control system is not a new idea. In fact, just last year congressional republicans pushed to privatize the system, but ultimately failed. Perhaps this time will be different as the plan does have the support of the Airline industry as well as the ATC controller’s union. These groups argue privatization will remove ATC from the hassles of government funding and the constant spending disputes which has paralyzed the agency in recent years.

While removing Air Traffic Control from the constant funding challengers associated with governmental operations is surely a plus, that one aspect does not make up for the disastrous ramifications privation will have.  The fact of the matter is that ATC in the U.S. is already pretty great. The U.S aviation system is universally seen as one of, if not the safest in the world. It is also the most accessible and economical aviation system in the world.  Privatization would radically change the purpose and mission of Air Traffic Control. Instead of being a government agency accountable to the people, it would be a private organization controlled by it’s stakeholders.

So if the system isn’t broke, then why is there a push to fix it? To obtain that answer you just need to follow the money. The U.S. airline industry has been pushing privatization for years with their lobbying group, Airlines for America, leading the way. They support privatization because it would give them more control over the air system while also reducing their costs. Currently, ATC is funded through the FAA’s fuel taxes and fees. Privatization would mean that all funding for ATC would come directly from user-fees charged for air traffic services. This represents a massive shifting of costs, as general aviation would end up bearing a significantly higher burden than currently experienced.

Furthermore, removing ATC from the FAA control means less oversight and regulation of Air Traffic Services within the U.S. Instead of being answerable to U.S. citizens, the new organization would likely be more beholden to industry stakeholders, with the airlines gaining unprecedented influence. Even worse is that fact that there is no financial incentive for this plan. It would cost U.S. taxpayers 89 billion dollars and ad over 19.8 billion dollars to the deficit.

Why then is there a push for ATC privatization? The answer, of course, is to follow the money. The U.S. airline industry, led by its lobbying group Airlines for America, has been pushing for privatization for year. The airline industry is the only group that gains from privatization. Their costs would go down as user fees would shift a significant burden to general aviation users. Additionally, the airlines would be represented in the privatized corporations 13 member board, meaning they would be in the captains seat so to speak. They would literally be controlling ATC.

Supporters of privatization point to the U.K. and Canada as examples of where ATC privatization has worked. This is misleading though, as the U.S. Air Traffic System is nearly 10 times larger the Canadian or U.K systems (in terms of aircraft movements). Even then, when equalized for movements, the U.S. system is more cost-effective. Finally, the privatization of ATC in those countries has significantly impacted general aviation in those countries. Privatization has made flying more expensive for small aircraft while also reducing access to airports and airspace.

The saying goes, “If it ain’t broke, don’t fix it” and that mantra certainly applies here. Privatization is not about efficiency or cost. It is a thinly veiled power grab by the airlines. The U.S. air traffic system is clearly not perfect. The roll-out of the NextGen system has admittedly been a mess, but privatization does not address this issue. Less accountability and control is not the answer. User-fees do not save taxpayers money, they simply leave general aviation users further in the lurch. ATC privatization is a pointless endeavor. Let’s tell Trump that ATC is already great and that he should keep his tiny hands off of it.