CEO Bunce Uses Annual Briefing To Shoot Down FAA's User Fee Plan

The numbers are in... and what numbers they are! Monday, leaders of the General Aviation Manufacturers Association (GAMA) announced shipments of every type of general aviation airplane increased in 2006 and the strong numbers have led to another record high in industry billings.

Speaking at GAMA's Annual Industry Review and Market Outlook Briefing, GAMA Chairman Dr. John J. Grisik cited factors that contributed to the banner year.

"Worldwide economic growth, a strong export market, and increased use of general aviation for both business and personal use all played a part in this outstanding year for general aviation," said Dr. Grisik. "As our manufacturers continue to fill their order books, GAMA anticipates another robust year for general aviation in 2007 and beyond."

The all-time high for billings totaled $18.8 billion, a 24.1 percent increase over 2005. Year-end, worldwide shipments of general aviation airplanes totaled 4,042 units for 2006, up 12.9 percent over the previous year's total of 3,580 units. Aside from the record set for year-end billings, the industry also experienced an all-time high in business jet shipments.

Piston airplane shipments experienced an 11.6 percent increase over the previous year. Total units increased from 2,465 in 2005 to 2,750 airplanes in 2006. Shipments of turboprops increased by 11.5 percent, up from 365 units in 2005 to 407 units in 2006. Business jet shipments increased in 2006, to a total of 885 airplanes, up 18 percent over last year's figure of 750 units.

Bunce Shoots Down User Fee "Myths"

While the numbers announced at Monday's briefing were cause for celebration for GA, GAMA President and CEO Pete Bunce also took the opportunity to dispel many of the myths the Administration has put forth regarding the need for an overhaul of the current funding mechanism -- a situation that could bring recent growth in GA sales to a screeching halt.

Bunce began by demonstrating that the current mechanism of aviation excise taxes is, in fact, a stable and predictable method of funding, despite the Administration's insistence that it is not.

"Over the past ten years, the US Congress has routinely given the Federal Aviation Administration (FAA) more than the President asked for in the budget. You cannot get much more stable than that," said Bunce. "Trust fund revenues, which help fund the FAA, are at record levels and projected to continue to grow through 2012."

Secondly, the Administration has insisted that a new funding mechanism must be created in order to fund the transformation of the air traffic control system. However, according to the President's own budget, the Administration's user fee scheme would generate approximately one billion dollars less than the current mechanism.

"The Administration's proposed funding scheme is not about modernization," said Bunce (shown above, at Oshkosh 2006.) "It is shifting costs from the airlines onto general aviation."

Representatives with GAMA tell ANN their organization also challenged the notion that Congress would remain in control of the FAA budget with implementation of the Administration's user fee scheme. Under their proposal, the FAA Administrator would set fees on an annual basis to cover costs as necessary.

"The pressure on the FAA to responsibly spend taxpayer dollars, currently overseen by the Congressional authorization and appropriations processes, would go away," said Bunce. "We cannot afford to give the FAA a blank check to fund its operations."

Lastly, GAMA addressed the belief that a user fee scheme would be an efficient method to collect revenue. "You cannot implement user fees without also creating another bureaucracy to collect them," said Bunce. "The current system of aviation excise taxes is an efficient and cost effective method to fund the FAA."

"No one is more committed to the modernization of the national airspace system than aviation manufacturers," said Bunce. "We must move past this ill-advised user fee proposal and focus the efforts of our industry and government partners to design and implement a modernized air traffic management system."

In other words... don't mess with success. At least, unless you're the FAA...

FMI: www.gama.aero, Download GAMA's Full 2006 Sales Report (.pdf)