Two years after making its big step into third-party business aviation services with a $2.18 billion acquisition of Jet Aviation, US defence giant General Dynamics is merging its four aerospace brands into two: Gulfstream and Jet Aviation.
This means Midcoast Aviation, the St Louis completions centre bought by the Swiss company in 2006, will be renamed Jet Aviation from 1 January.
CONFUSING IDENTITIES
From the same time, General Dynamics Aviation Services - a network of five service centres in the USA and one in the UK specialising in Gulfstream - will operate under the Gulfstream brand.
The move consolidates what, for some, had been a confusing set of identities. Jet Aviation kept the 35-year-old Midcoast name because of its legacy in the market, but its logo had been adapted to include Jet Aviation. Jet Aviation's own logo today identifies it as a General Dynamics company.
Buying Jet Aviation was a brave step for the defence contractor, whose interests span from ships to information technology, even given the fact that General Dynamics has been a prolific and successful acquisitor, integrating 43 businesses over the past decade.
In addition, Jet Aviation - which began as a family firm in Switzerland and was latterly acquired by venture capital fund Permira - was one of the most diversified and respected business aviation services players in the world, with interests from aircraft management and charter to fixed-base operations and business jet remarketing.
However, the acquisition meant that the General Dynamics aerospace division found itself doing business with some of Gulfstream's arch-rivals, particularly Bombardier, with which Jet Aviation has had a long-standing close relationship. Strict Chinese walls had to be built between the two divisions, both of which were ultimately headed by Gulfstream chief executive Joe Lombardo, who effectively has to wear two hats: one to run the Savannah airframer and the other to oversee the Swiss group, which is headed by former Bombardier executive Peter Edwards.
Under General Dynamics, the Jet Aviation business has benefitted from serious investment, some of which was under way before the takeover.
Midcoast's St Louis facility was expanded with a new hangar in 2008. However, four months ago it announced the closure, to be accomplished by the end of the year, of its Savannah site, home of Gulfstream, to focus on the St Louis "centre of excellence". The closure will affect around 300 jobs.
The expansion at St Louis allows Midcoast, which employs almost 1,000 people in the Midwest city, to move into the narrowbodies completions market and take on more work from Jet Aviation's Basel completion centre in Switzerland.
The centre is one of a handful of facilities in the world able to handle larger Airbus and Boeing jets. It is at capacity on narrowbodies as it focuses on the more specialist and lucrative widebody airliner conversions, a number of which are coming on the market as more billionaires in emerging markets discover the joys of these flying palaces/corporate offices.
Midcoast also performs maintenance on a range of types, including Bombardier Globals and Challengers, Dassault Falcons and Hawkers as well as Gulfstreams. General Dynamics says rebranding the operation "will more fully integrate it as part of the Jet Aviation global maintenance service network".
GDAS was created as the result of acquisitions from Kimberly Clark in 1998 and BBA Aviation in 2001, the latter of which gave GDAS its Luton, UK site (which already runs under the Gulfstream brand). GDAS's other facilities are in Appleton (Wisconsin), Dallas, Las Vegas; West Palm Beach (Florida) and Westfield (Massachusetts).
IMPACT
The centres will continue to service other types, mostly out-of-warranty Bombardier Challengers, Dassault Falcons and Hawkers - currently about 30% of their business. They will continue to be run by Mark Burns, president of Gulfstream product support.
He predicts the rebranding under Gulfstream "will have some impact" on the third party business, but that the effect will be minimal as the GDAS facilities are not authorised maintenance centres for the rival manufacturers. There is some competition between GDAS and Jet Aviation, but again, he says, the overlap is not significant.
Source: Flight International
