By CHUCK BARTELS
LITTLE ROCK, Ark. — Arkansas’ U.S. senators on Wednesday defended the use of corporate aircraft, saying flying aboard jets allows executives to accomplish business that can help revive the state’s economy.
Members of Congress blasted auto executives in November after they flew to Washington on private aircraft to seek billions of dollars in government aid. In the aftermath, executives from many companies canceled orders for corporate jets.
“It was a factor in the erosion of our business,” said Jeff Habib, senior vice president for U.S. and Canada sales for Paris-based Dassault Falcon, a corporate jet manufacturer with a major finishing plant at Little Rock. “New business is slow. This combined with cancelations has produced a very difficult year for all of us.”
At a forum to discuss aviation’s impact on Arkansas’ economy, Democratic Sens. Blanche Lincoln and Mark Pryor noted that executives often must make it to meetings quickly. Arkansas residents, for instance, can fly few places nonstop.
“When corporate America is looking to be competitive … what they do is look to general aviation,” said Lincoln, who said she learned to fly as a teenager in eastern Arkansas.
Pryor noted the heavy general aviation traffic at Rogers, home to fleets for Wal-Mart Stores Inc. ( WMT – news – people ) and Tyson Foods Inc. ( TSN – news – people )
“The truth is, that’s how business is done,” he told a crowd of about 500 workers sitting in front of a Falcon 2000LX jet.
More than 3,500 people work in Arkansas’ aviation industry, which was responsible for $1.4 billion in exports in 2008. Only agriculture – with $2.2 billion in exports in 2007, the latest year for which figures are available – is a bigger business here. Measured against individual commodities, aviation is the state’s top export.
Paris-based Dassault and Wichita, Kan.-based Hawker Beechcraft Corp. have completion centers at Little Rock, where workers paint the planes and fit them with custom interiors. Both companies have suffered layoffs this year because of canceled orders. Dassault now has 2,100 employees, while Hawker Beechcraft has 600.
Pete Bunce, president and chief executive of the General Aviation Manufacturers Association, said corporate jets provide an efficient means for executives to go from place to place and make deals that keep the economy moving.
“We shouldn’t have to defend these machines that are one of the bright spots of the economy,” Bunce said.
Pryor, who sits on the Senate Commerce Committee, said he has tried to help the general aviation industry by opposing a proposal to ban some companies that received economic stimulus money from using corporate jets.
Treasury Secretary Timothy Geithner in January had Citigroup ( C – news – people ) cancel delivery of a new corporate jet it planned to buy after receiving billions of dollars from the government.
Congress passed a tax break to help the general aviation industry just a few months after the run-in with the auto executives.
http://www.forbes.com/feeds/ap/2009/08/12/ap6772750.html
Source: FORBES (ASSOCIATED PRESS)
Date: 2009-08-12