By
Brian R. Hook
The popularity around the globe of business jets is soaring,
helping to bring millions of dollars into the St. Louis region
thanks to the aircraft maintenance, modification, and completion
services provided by Midcoast Aviation Inc.
Kurt Sutterer, president of Midcoast, characterizes the growth
at the Cahokia, Ill.-based company at the St. Louis Downtown
Airport, as robust. Revenue, currently at about $230 million
per year, is growing about 25 percent a year, Sutterer says.
Much of the outfitting activity at Midcoast is driven by relationships
with original-equipment manufacturers, Sutterer says. Manufacturers
currently have a three-to-five-year backlog in sales of new
business jets due to the strong global demand.
The completion of a business jet takes six months to a year,
post delivery of the airplane being manufactured. Sutterer says
there are currently about 13,000 business jets in service around
the world. He estimates there will be 9,000 to 10,000 more by
2015.
“It’s got a significant growth curve in front of it globally.
A lot of the drive is coming out of Europe, the Far East and
emerging markets. The U.S. market is robust too. So, you are
looking at an industry with a really robust outlook to 2015,”
Sutterer says.
To match the growing demand, Midcoast finished a 120,000-square-foot
expansion earlier this year, bringing its total operation under
roof to about 500,000-square-feet. It plans to start building
another 150,000- square-foot hanger later this spring.
Midcoast, which was acquired by Zurich, Switzerland-based Jet
Aviation Group in March 2006, is also looking for more employees.
It currently employs around 1,000. Sutterer says the company
has been adding around 120 to 150 new employees a year.
Sutterer says there is a scarcity of the highly technical employees
needed by Midcoast, therefore the company is recruiting around
the country. “We have been working on a building a much more
robust compensation plan over the last five years. We are doing
a lot with regards to canvassing to hire a skilled work force,”
he says.
In addition to the technical skills needed for the typical aviation
maintenance work, specialized skills are needed for modification
and completion services.
Midcoast creates very high-end custom interiors for business
jets. For example, it often installs showers, bedroom suites,
and all kinds of data management services—including audio-visual
equipment, satellite phones and entertainment systems.
“You ask for it, we can do it,” Sutterer says. “We have clients
that are conservative and subtle to extravagant.” Some of the
more extravagant items include gold inlays and exotic veneers
that cost $2,000 to $3,000 per sheet, Sutterer says.
More and more people have started to use business jets in the
last few years, says Bob McDaniel, director of the St. Louis
Downtown Airport. The airport, owned and operated by the Bi-State
Development Agency, is the closest airport to downtown St. Louis—located
only three miles from downtown across the Mississippi River.
“Since September 11th, 2001 there’s been a very strong shift
of business travelers away from airlines to business aviation,”
McDaniel says. More fractional ownership, which allows multiple
owners to share a jet, has also boosted business, he says.
“The business aircraft has really become a business tool, not
just for the CEO, but more and more you’ll find business jets
loaded with mid-level managers and sales people out doing their
jobs, rather than just corporate executives flying around,”
he says.
The St. Louis Downtown Airport is the airport that people fly
to when they are coming to St. Louis for business, McDaniel
says. “We’re the welcome mat for St. Louis. We are the front
door for business aviation coming from other locations.”
McDaniel estimates that the airport has an annual economic impact
on the region that exceeds $200 million. He says Midcoast is
a major portion of the business at the airport. Of the 1,300
jobs at the airport, 1,000 come from Midcoast. Plus, half of
the property at the airport that is available for development
is occupied by Midcoast.
“Business aviation is stronger, more active, more vibrant, and
growing more than it ever has been,” McDaniel says. He cites
numbers by the General Aviation Manufacturers Association, a
trade group in Washington D.C., that reports business jet shipments
increased in 2006 to a total of 885 planes, up 18 percent over
2005.
“Midcoast is on the leading edge of supporting that market,”
McDaniel says.
Patrick McKeehan, executive director of the Leadership Council
Southwestern Illinois, the economic development organization
for Madison and St. Clair counties, notes that Midcoast brings
in business jets from all over the world, drawing in money.
“I think it is critically important that we have these types
of companies in our area, with the ability to provide jobs and
draw revenue into our region,” McKeehan says.
“Midcoast provides great opportunities for jobs. We are blessed
to have Midcoast here. I think that it is the type of operation
that reflects well on the metro-east area.”
