““Last year, complaints about airlines increased 22%. There were probably more complaints, but the airlines lost them.” ”
Give your cabin a facelift
Many individuals and corporations are deciding to keep the jets they have rather than upgrade. Others are taking advantage of a weak market to buy used models at bargain prices. For those in either camp, interior refurbishment offers an economical way to extend the life of an aging cabin.
Nevertheless, most refurbishment centers are working at less than capacity as the recession drags on. Some are trying to trim costs simply to remain open, while others are offering bids just sufficient to cover employee wages and overhead, according to an executive who preferred not to go on record. "Eighteen months ago, there was some overpricing," he said. "Now, it's a buyer's market and, in some cases, the cost of a refurbishment is as low as it was in the mid-1980s."
If you're thinking about refurbishment yourself, you should start by asking whether it's really necessary; perhaps a mere detailing would suffice to restore that "new" look, feel and smell. If not, would it be enough to replace carpet, reupholster the seats and buff out and repair cabinets? Or does the airplane need a complete makeover, which may mean stripping out the interior and starting over?
Cost and time are big issues, of course. Detailing-pulling the seats to repair tears and clean and re-dye the leather, repairing minor scratches in the cabinetry and so on-can run about $45,000 for a Gulfstream V. Such a job would require about five days and could be done while the aircraft is in for maintenance or an avionics upgrade. By comparison, a major refurbishment that requires stripping out a GV cabin and building and installing new furnishings is likely to start at about $750,000 and could run $2 million with the installation of such goodies as high-speed Internet connectivity and an entertainment system. This job could easily require several months.
The extent and style of a refurbishment depend largely on how the aircraft is to be used. Corporate aircraft, as well as those flown by fractional operators and for charter, are most often refurbished in a style similar to that of the original cabin-relatively "vanilla" with few, if any, eccentricities. Many private owners, too, opt for a fairly neutral interior to maintain resale value.
Brokers think that's smart, and note that a highly customized interior often reduces market appeal. "The airplane can be relatively new, low time and well equipped, and the interior may be immaculate, but there are buyers who will take one look and not get beyond the fact that the cabin isn't to their taste," said BJT columnist Bryan Comstock, the president of Jeteffect, a jet sales and acquisitions firm in Long Beach, Calif.
While a cabin's condition or décor may affect resale value, incidentally, it often has little to do with whether the new owner opts for refurbishment. "We had a client for whom we did a major cabin refurbishment," recalled Mary Wichterman, interior design manager for Airovation, a Minneapolis refurbishment shop. "He sold it just a year later and the new buyer brought it back and had it completely stripped out and redone." For some customers, cost is apparently not an issue.
Some owners opt for a minor refurbishment before putting their aircraft on the market, reasoning that it will increase resale value. According to brokers, cabin refurbishment may indeed have that effect and might also increase the likelihood of a quick sale.
But with older aircraft, a minor refurbishment may not be cost-effective. Technical documentation may have been lost, a subsequent inspection may reveal corrosion that must be dealt with or original vendors may have gone out of business, limiting the availability of replacement components. Suddenly, a minor refurbishment becomes a major hassle and costs escalate.
One of the best ways to start with a cabin upgrade is by hiring a consultant whose profession is managing the process. Cabin refurbishment is incredibly complex, involving everything from regulatory issues and FAA requirements to selecting entertainment system, seat coverings and cabinetry veneers. A consultant can help you navigate this and can catch errors before they cost you.
A consultant can also assist you with picking a refurbishment center, which is a challenge in itself. Among the questions you or your consultant should ask: Does the center have experience in your particular model? Is it an FAA-certified (Part 145) repair facility? Can it handle other necessary modifications, such as avionics and exterior paint capability, thereby reducing down time? And does it have a reputation for on-time, on-spec delivery that it can back up with references from previous clients?
Ask these questions, sign on the dotted line with the right center, wait a little while and you'll likely wind up with a beautiful cabin at a fraction of what it would cost to replace your airplane.
Refurbishment on a Grand Scale
If there is a segment of the refurbishment industry that remains strong, it is that of airliner conversions to executive/VIP configuration. Among the centers focusing on this field are Lufthansa Technik in Hamburg, Germany; Jet Aviation in Basel, Switzerland; Comlux Completion USA in Indianapolis; Gore Design Completions, San Antonio, Texas, Canadian centers Flying Colours in Calgary; Mjet in Montreal; 328 Support Services in the Netherlands and BAE Systems in the UK.
Cost is the driving force in this market, certainly for the smaller regional airliner conversions. A low-time CRJ200 can be converted to a large-cabin executive/VIP role for around $16 million, including acquisition cost of the aircraft. A reconfigured Avro RJ or Dornier 328Jet can be converted for about $10 million to $13 million.
As for the larger airplanes--narrowbody Airbus A320s and Boeing 737s and widebody Airbus A330s and Boeing 747s--the cost is not inconsiderable. But as one completion center executive put it, clients with such aircraft have so much money that the recession is not much more than a minor bump in the road. Refurbishment centers specializing in these larger airliner conversions are still working at capacity and most are booked well into 2011.