AIN Staff

Before the recession truly made its presence felt, Italian OEM Piaggio Aero recognized its impending arrival and adjusted production rates accordingly, said Piaggio America president and CEO John Bingham. “What we were able to do was recognize it early enough to reposition in terms of manufacturing and market access.”
Bingham was speaking from his office in Genoa, where the $8 million Avanti II twin turboprop is built. “We had no ‘white-tails’–no stock that had to be turned into cash at any price.”
Not that Piaggio Aero didn’t feel the recession. In the first nine months of 2010, Avanti II deliveries dropped from 17 to six. “We think 2011 deliveries will probably be somewhere along the same lines as 2010,” said Bingham.
Whatever the 2010 delivery totals, they will almost certainly represent a dramatic drop from delivery totals of 30 Avantis and Avanti IIs in 2008 and 24 Avanti IIs in 2009. On a more positive note, Piaggio still has a backlog of nearly 70 aircraft.
The U.S. accounts for about 50 percent of Avanti II sales, and most of those are to Avantair. The Clearwater, Fla. fractional operator has a fleet of 55 Avantis and Avanti IIs and has orders for another 45 Avanti IIs to be delivered through 2013. The Avantair fleet, which is averaging 120 flight hours a month per aircraft, said Bingham, speaks for the airplane’s reliability and durability.
A Budding Market Presence
Bingham said the recession had some positive effects, encouraging Piaggio to look at new markets, among them Australia and Brazil. The Avanti II was certified in both countries late last year, and those markets are relatively stable compared with the U.S. and Western Europe. In addition, Piaggio Aero has signed a <a href="http://www.bjtonline.com/s/article/piaggio-aero-takes-on-russian-market-2546.html">partnership agreement with Russian’s Aviacharter</a> “to explore the Russian Federation market.”
Piaggio Aero has also appeared at a growing number of trade shows in just the past year. In January the OEM participated for the first time at AeroExpo Marrakech, at Menara Airport in Morocco. The last half of the year was particularly busy, as the company exhibited at the Latin American Business Aviation Conference &amp; Exhibition in Sao Paulo, Brazil; participated at JetExpo in Moscow; exhibited at the NBAA Convention in Atlanta; shared space with Italian home furnishings firm Benetti at the Monaco Yacht Show; showed the flag at Airex International Civil Aviation and Airports Exhibition at Ataturk Airport in Istanbul, Turkey; appeared at Meba 2010 (Middle East Business Aviation) in Dubai, United Arab Emirates; and exhibited at the Boot Düsseldorf boat show in Germany. “Our trade show activity will continue to be busy for 2011 as well,” said Bingham.
Piaggio Aero has also seen interest grow in the Avanti II in an air ambulance and medevac configuration. The most recent delivery was to Ambulance Worldwide of Palm Harbor, Fla. The Avanti II is particularly well suited for air ambulance and medevac operations, said Bingham, because of its spacious cabin, 400-plus knots max cruise speed and efficient fuel burn. “A less well known advantage in a medevac and air ambulance role is that cabin pressure is that of sea level up to an altitude of 24,000 feet, said Bingham, “a definite plus for patients with respiratory problems.”
Piaggio America’s U.S. staff totals 20, managed from its West Palm Beach headquarters, and Bingham says growth in service and support has been considerable, from six Piaggio-approved centers in 2009 to 20 by the end of last year. The company also has a seven-days-a-week customer support desk and dedicated team available to resolve technical issues.
The largest Avanti fleet in the world is in the U.S. and totals 108 aircraft. The fleet worldwide totals approximately 210 aircraft.
New Projects
For at least the last decade, the industry and the market have waited for an announcement by Piaggio Aero of a new business airplane. There has been much speculation as to what form it would take–an upgrade of the successful Avanti with turbofans replacing the turboprops, a clean-sheet larger version of the Avanti, or a clean-sheet turbofan airplane.
Piaggio designers have in the past scoffed at the idea of hanging jets on the Avanti. As one of them put it, it would go only a little faster and would burn a lot more fuel. The company has admitted it is working on a new airplane project, but it has released few details. According to Bingham, Piaggio’s next business aircraft, which he referred to as the <a href="?q=node/24933">P-1XX program</a>, “is continuing with the full support of our shareholders.” The only other details he offered: “It will likely be bigger than the Avanti II and a date to announce it has not been decided.”
The shareholders to whom Bingham refers are the De Mase and Ferrari families and more recently Abu Dhabi state investment fund Mubadala and <a href="?q=node/18428">Indian conglomerate Tata</a>. The latter two have added more stability and fresh funds to help develop a new airplane, and to survive the recession in a position to go forward and expand. “They are supportive and participative,” Bingham stated. “The best we could wish for.”
Thanks to adjustments in production, expansion into new markets and a move to lean manufacturing practices, said Bingham, “when a global recovery begins, we expect to have a stronger market presence than when the recession began.”
As for an end to the recession, Bingham smiled when asked when he thought the business aviation industry might see the start of a true recovery and return to previous activity norms. “I wish I had a crystal ball,” he said. “There are a lot of buyers sitting on the fence, waiting to be sure their own company has emerged intact from this recession.
Piaggio America president and CEO John Bingham spoke to AIN about the state of his company and the industry. Listen at: <a href="audio">www.ainonline.com/audio</a>.

Piaggio America exec: company adapted early to counter recession

Before the recession truly made its presence felt, Italian OEM Piaggio Aero recognized its impending arrival and adjusted production rates accordingly, sai

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