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Flying in style.


IT'S A 47-FOOT TUBE WHICH CAN HURTLE through the air at almost 500 miles per hour. It seats seven comfortably with room for an eighth to perch on top of the toilet, and even that comes complete with its own cushion and seatbelt. It costs US$4.4 million. If you are going to buy a Cessna Citation V jet, plan to spend another $400,000 a year to maintain and fly the plane. Or, put another way, expect to pay out more than $650 per hour each time the jet leaves the ground.

There are more than 1,000 private planes registered in Manitoba and many are used for business travel as executives wing themselves across this vast continent stretching their corporate horizons.

Paul Albrechtsen, president and owner of Paul's Hauling Ltd., bought a Cessna Citation jet for about $3 million and he says today it would cost about $4 million. He will spend around 250 hours a year in the air on business travel.

The low-key Albrechtsen, 59, has a large company based in trucking, but has diversified over 35 years into property development. With 800 trucks on the road and 30 terminals from Manitoba to the Northwest Territories and a $100-million condominium development near Denver, Colorado, the entrepreneurial Albrechtsen is always on the move.

"With 12 companies we spend a lot of time visiting terminals and we can make it better with our own plane," he says. "I have flown for 35 years and I have a pilot. Now I just fly when I want to."

James Richardson & Sons, Ltd., the Winnipeg grain merchant, has moved executives around on a leased plane for 15 years. And company president George Richardson pilots his own $350,000 private helicopter, one of only four helicopters registered in the province. He would rather fly to his summer camp on Lake of the Woods than drive.

Robert Black, owner of Pro-Telec Ltd., an alarm company, has flown his own plane since 1978. Black has logged about 2,500 hours during this time on his Bellanca Viking, a single-engine, four-seater. He says it saves him time.

"It's really convenient when you can fly to Regina for a luncheon meeting and be home the same day. And I find it safer than driving on the highway because once you're up there, there's not a lot of other traffic around," he says.

Al Oze, president of Winnipeg-based E-Z Cut Inc., an equipment supplier to carpet retailers, owns and pilots a twin Aerostar. He's had the $250,000 machine for three years and says his business would be different without it. For starters, he would have to spend a lot of time waiting in airports, something he hates. Furthermore, it's difficult, if not impossible, to get into smaller communities aboard regular carriers.

"Our business is mainly in smaller centres like Fort Wayne, Indiana," says Oze. "To get there I can waste a whole day hopping from airlines to commuters or, with my plane, I can leave in the morning and be back by 7 p.m." It costs Oze almost $50,000 a year to keep the Aerostar humming. "It's costly," he says, "but I wouldn't be without it."

Ross Robinson, president of B.A. Robinson Company Ltd., says his pressurized twin-engine Cessna Skymaster, which would fetch about $60,000 on the used market, costs less than the price of a new luxury car and gets him places twice as fast, without any radar traps. His company is a wholesaler to the construction industry and has branches in Manitoba, northwest Ontario and British Columbia.

The plane has been part of the operation for 14 years. Robinson's opinion is Manitoba businesses miss opportunities by not having a company aircraft. "It helps me stay ahead of the competition," he says.

To others, planes are a touchy topic. Are they an important business tool? Or are they simply a luxurious ego stimulant for the top brass? The argument in favor of planes usually boils down to the cliche -- time is money. For Oze, the bottom line is obvious. "It depends what you value your time at. For me it's worth it, otherwise I wouldn't do it."

According to some business leaders, the shareholders of corporations sometimes have trouble with the time/money explanation for the use and cost of private aircraft. Richard Andison, chairman and CEO of Powell Equipment Ltd., says: "Shareholders often say, 'Oh, they're just making life easier for themselves.' They look at a plane as a luxury rather than a tool."

There's hardly any luxury in Andison's Cessna 206 single-engine float plane, which he flies about 200 hours a year. He uses the $125,000 Cessna for customer calls to remote locations in the bush on pipelines and small towns in Manitoba and northwestern Ontario. Powell supplies heavy construction equipment to contractors. "It's a tremendous business tool. I make great use of ours," he says.

For longer hauls, Powell Equipment has a timeshare agreement with a group of companies in a Falcon 100 jet owned by the Reimer trucking group. Don Reimer, president and CEO of Reimer Express Enterprises Ltd., is the central figure in the timeshare arrangement. He runs Rex Aviation which has owned the twin-engine, $5-million jet for a year.

Company spokesman Gerald Reimer uses the plane to visit its far-flung trucking empire in North America.

"We have had the plane for a year and find it a convenience that helps us a lot," he says.

Other companies that have used the jet include The Great-West Life Assurance Company and Federal Industries Ltd.

Andison books Rex Aviation's Falcon jet between 50 and 100 hours a year, mostly for flights to the U.S. In it he zips south to visit factories, inspect machinery or attend conferences. He also uses the aircraft to woo customers. In the slow-motion dance that precedes a sale, when seller and buyer are trying to sway to the same tune, what kind of a chord does the swiftness, convenience and comfort of a private plane sound in the deal? "It's a very difficult thing to really put a handle on, capturing a dollar value benefit on it," he says. However nebulous the cost/benefit analysis seems to company accountants, Andison says the corporate statement made by a business plane is worth far more than the expense.

The reason is geography. The majority of Canadian business travel is east-west and those routes are already well served by commercial carriers. But south of the border it is different. "Nobody flies in odd angles in Canada," says Fonger, "but the U.S. is like a square and people go in a million different directions."

To go in any of those directions requires either a hired pilot or some costly flight lessons. The price tag for a private pilot's license is about $6,500. For an instrument endorsement -- meaning you can fly in the clouds -- add a minimum of another $6,000 and sometimes much more. It cost Al Oze $15,000 for his instrument rating and twin engine training.

In spite of the costs, corporate aviation is a growth business. According to figures from the Canadian Business Aircraft Association, business use of private planes grew by 6.7 per cent between 1989 and 1990.

Ernie Hedberg, the manager of Esso Avitat, laments that not much of that comes through Winnipeg. "Winnipeg (International Airport) has been sitting still for a long time. We don't have a customer base like other airports," he says. "There's a tremendous amount of business aircraft, a whole market out there. We just have to develop it." Esso Avitat is one of two fuel retailers at Winnipeg International Airport. It is a new, $2.5-million facility that Hedberg opened last year. Now, he's suffering through the slowest period ever.

Still, for the few Manitoba businesses that do use private planes, the flying isn't all work. Al Oze says once he gets up to cruising speed and altitude, particularly over the relatively deserted skies of the north-central border states, he puts the plane on auto-pilot and reads the newspaper. Try doing that on a highway.
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Title Annotation:business airplanes
Author:Ryan, Bramwell
Publication:Manitoba Business
Date:Dec 1, 1991
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