Characteristics of the FBO Industry 2018-2019 (2020)

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1 Overview The term fixed-base operator (FBO) is defined by the FAA as “a business granted the right by the airport sponsor to operate on an airport and provide aeronautical services . . .” (FAA AC 5190.6B). The most basic FBO offers its customers self-service (SS) fueling. Typi- cally, an FBO offers a set of core services such as fuel, use of hangars, ground services, and, sometimes, aircraft maintenance. The services offered varies, as FBOs may cater to small general aviation (GA) aircraft, business aviation, commercial airlines, cargo operators, military flights, or a combination of clientele. This synthesis report profiles the FBO industry as of December 2018. The ACRP funded this analysis of data to prepare a quantitative snapshot of the FBO industry that would serve as a reliable baseline of information and would establish useful metrics to track FBO trends in the future. The scope of the project includes the following: • An estimate of the total number of FBOs operating at public-use airports in the United States; • A discussion of organizational characteristics of FBOs owned by – public entities, – independent private FBOs, – small-network FBOs, – large-network FBOs, franchises, and affiliates; • An exploration of the relationships between scale and types of airport activity and level of FBO services; • An analysis of geographic variations in the delivery of FBO services and fuel prices; • A focus on SS fueling and its use by different types of FBOs; • An examination of branded and unbranded fuel strategies; and • A profile of FBO services offered. It is the hope and intention of this synthesis report to establish a firm foundation of information that can be updated in the future and to pave the way for more complex analyses of different aspects of the FBO industry in the United States. Methodology Elements from three databases were acquired and merged: (1) the FAA Form 5010-1, Air- port Master Records (5010); (2) the National Plan of Integrated Airport Systems (NPIAS); and (3) FBO data self-reported to AirNav, LLC. Data from the three sources were linked for S U M M A R Y Characteristics of the FBO Industry 2018–2019

2 Characteristics of the FBO Industry 2018–2019 each airport and for each FBO that operated at a public-use airport. The data were checked for anomalies and inconsistencies, updated, and used to generate the tables and graphs that appear in this report. Organization of Chapters This report is organized into multiple chapters so that readers can easily find subjects of interest. • Chapter 1 provides an overview of the project. • Chapter 2 examines key trends in GA that have impacted the FBO industry and shaped it today. • Chapter 3 discusses the types of FBOs and their prevalence at different public-use airports. • Chapter 4 describes FBO products, services, and facilities from a national perspective. • Chapters 5 and 6 analyze private FBOs and publicly owned FBOs. • Chapter 7 is a roadmap that discusses the inherent challenges with available data sets, opportunities for future refinements, and major conclusions of the analysis. • Appendix A describes the three data sets used. • Appendix B presents consolidated tables from the analysis. • Appendix C presents the references and bibliography. • Appendix D contains a glossary of terms. • Appendix E presents a list of acronyms used in the report. Findings from the Study The study analyzed FBOs that are located at public-use landing facilities throughout the country. Public-use landing facilities are defined by the FAA and primarily include airports, heliports, and sea plane bases owned by both public and pri- vate entities. The majority are traditional airports (95%); the remaining facilities are seaplane bases (4%), heliports (1%), and a few facilities for gliders, ultra lights, and balloons. For the purposes of this report the term airports will refer to all landing facilities. As of December 2018, there were 5,092 public-use airports. The total number of airports with one or more FBO location was 3,233. There were 299 airports with multiple FBOs accounting for 727 FBO locations; however, one FBO location per airport was most prevalent (2,934 airports with one FBO). The FBO industry provides aeronautical services to a wide spectrum of aircraft operators that include business and per- sonal flying, charters, air medical, aerial applicators, firefighting, search and rescue, com- mercial, military, and air cargo airlines. Because FBOs operate in such different markets, there are many external and internal factors that influence scale of operations, demand for services, customers, competition, operating costs, and revenue potential. Catalysts for change in the FBO industry are coming from many directions and include • A strong correlation with economic conditions (up and down); • Changes within commercial aviation that favor concentration of airline service in the largest metropolitan areas and present opportunities for FBOs to support air service in smaller cities; Groups Number Percent (%) Public use airports with FBOs 3,233 63 Airports without FBOs 1,859 37 Total public use airports 5,092 100 Airports with 1 FBO 2,934 91 Airports with multiple FBOs 299 9 Airports with 1 or more FBOs 3,233 100 Single FBOs operating on airports 2,934 80 Multiple FBOs operating on airports 727 20 All FBOs at public use airports 3,661 100 Source: Compiled from FAA Form 5010-1, Airport Master Records, as of December 5, 2018, and AirNav Database as of December 2018.

Summary 3 • Continued dominance of piston aircraft, but diminished growth potential in this segment; • Improved prospects for business aviation, fractional ownership, and innovative ways to optimize use of private aircraft through charter services for nonowners; • Pilots and aircraft owners have greater pricing information and software to opti- mize air craft efficiencies and can negotiate prices for fuel and other FBO services in advance of a flight; • Airports exercise of proprietary exclusive rights to provide FBO products, services, and facilities and to use of minimum standards to influence FBO investment and require- ments for certain aeronautical services; • FBOs are unbundling the services, products, and facilities they offer to stay profitable and support customer demand; • Increased use of affiliations and virtual networks by FBOs to achieve consistent standards of service, brand identity, and customer loyalty without the capital costs of owner- ship; and • Ongoing challenges to the FBO industry posed by piston aircraft and pilot retirements, competitive price pressures on fuel, mechanic shortages, self-fueling by large fuel customers, and lighter, more fuel-efficient aircraft that reduce the need for en route stopovers. Of the 3,661 FBOs operating in the United States as of December 2018, the majority, 2,099 (57%), were privately owned. Airport sponsors, including municipalities, counties, and airport authorities, owned 1,543 FBOs (42.5%), and colleges or universities owned 19 FBOs (0.5%). The synthesis divided and analyzed FBOs into four categories: • Publicly owned FBOs and school-owned FBOs, most of which are individual operators; • Independent FBOs, privately owned facilities operating at one or two locations; • Small network FBOs, also privately owned, operating at three to five locations; and • Large networks, franchises, and affiliates, operating with more than five locations. Independent FBOs represent the greatest number of locations—1,666 locations or 45%. Publicly owned and school FBOs are a close second, with 1,562 locations or 43%. Small- (94) and large-network FBOs (339) represent 12% of locations, but generally operate at the largest, most active GA airports. All but 36 FBOs or 99% of 3,661 FBOs sell fuel as follows: • Full-service Jet A—2,143 (59%) • Self-service Jet A—2,164 (23%) • Full-service 100LL—824 (59%) • Self-service 100LL—2,335 (64%) Other top-ranked services and facilities reported by FBOs were • Hangar rental and leasing (42%) • Courtesy transportation or crew cars (40%) • General aviation terminal (29%) • Maintenance, repairs, and parts (29%) • Ground services and line services (26%) • Airport management (20%) The mix of products, services, and facilities listed by FBOs varied by type of FBO. One- third of publicly owned FBOs also manage the airport. Hangars, courtesy transportation and crew cars, and maintenance were the top three services for independent FBOs. For small- and large-network FBOs, ground services, line services, cleaning, and detailing were the highest ranked FBO services, followed by maintenance, repairs, and parts, and then air- craft rentals and charters. Scanning the services an FBO offers sheds light on the FBO’s

4 Characteristics of the FBO Industry 2018–2019 core businesses. Some FBOs specialize in flight training, charters, and sightseeing; others are primarily maintenance or avionics shops. The largest network FBOs are emphasizing brand, quality facilities, and access to specialists that can provide specific technical aircraft services and flight services for passengers, crew, and aircraft owners. The industry profile that follows provides a baseline to track changes as the FBO industry continues to evolve and adapt to new technologies, an ever-increasing digital environment, alternatives to carbon-based fuel, and the next generation of aviation users and FBOs.