When the Detroit Three CEOs flew in private jets to Washington to seek federal bailouts, they not only damaged the auto industry's image -- they tainted the image of business jets as well. Already reeling from deteriorating sales in the down economy, the business jet industry has found itself dealing with a guilt-by-association, public relations catastrophe. "What we saw was the caricature of the auto executives promoted as being representative of what business aviation is in the U.S.," said Ed Bolen, CEO of the National Business Aviation Association. "Really, it bore little or no resemblance to the vast majority of business aviation. "The automobile executives never really explained whether theirs was an appropriate use of business aviation or not," Bolen said. "That led people to think that it was an inappropriate use, (prompting) the next question: "Is business aviation always inappropriate?" The past few months have put the industry through the mother of all negative news cycles as the November hearings seemed to prompt a private-jet feeding frenzy. In December, when they returned to Washington for another round of hearings, the Detroit CEOs sought public atonement for the sin of flying, choosing to drive hybrids. Rick Wagoner of General Motors ( GM) drove a Chevrolet Malibu. Alan Mulally of Ford ( F) drove a Ford Escape and Chrysler's Robert Nardelli drove a Dodge Aspen. In January, the Obama administration pressured Citigroup ( C) to abandon plans to purchase a new $50 million corporate jet. In February, reports surfaced that Bank of America ( BAC) CEO Ken Lewis violated probity by flying in a private jet from Charlotte, N.C., to New York to attend a meeting regarding the New York attorney general's investigation of the payment of $3.6 billion in bonuses to Merrill Lynch executives.
The effect was to link corporate jets along with undeserved bonuses, the financial meltdown and banking failures in the litany of what's wrong with America. By March, anti-private jet sentiment was so pervasive that JetBlue ( JBLU) mounted an advertising campaign, visible at www.welcomebigwigs.com, to capitalize. In one spot, a greedy CEO addresses his peers, sneering: "They took away your private jet, didn't they?" and offers this remedy: "JetBlue can get you to many cities where you already own homes or hide money. They even have service to D.C., so you'll never be late for a congressional hearing." It has been, as they say, the type of publicity you cannot possibly buy. In February, the National Business Aviation Association, the General Aviation Manufacturers Association and some manufacturers mounted a campaign to counter the negative message. Jens Hennig, GAMA's vice president of operations, says it is not the first time. "We had a general education campaign, running through the 1990s, to explain corporate aircraft: the efficiencies, the job story," he says. "But we put it on the shelf, since we weren't having any major image issues going on." Hennig said the trade groups will spend several hundred thousand dollars. Parallel campaigns have been unveiled by manufacturers including Wichita, Kan.-based Hawker Beechcraft and Textron ( TXT) unit Cessna. "We understand the way humans work, the real frustrations they have about things that have happened in the economy, but we are trying to tell the other side of the story," as far as business jets are concerned, Hennig said. "I don't think anybody says we did anything wrong. We provide jobs and we're not companies looking for bailouts, but we've been dragged into the discussion."
The campaign points out that business aviation creates more than 1.2 million jobs and has a positive balance-of-trade impact, with most major manufacturers based in the U.S. Among business jet operators, 85% are small and midsized companies, while just 4% are among the Fortune 500, Bolen says. A typical operation may involve an executive with meetings in four cities in a day, a corporate headquarters in a small town with minimal air service, movement of products too big to carry on and too fragile for the baggage hold, and movement of medical supplies to small towns, he says. Unfortunately, says Hennig, the fallout has impacted sales. "We are dealing with the economy just like everybody else," he says. "With people thinking of buying a jet, thinking of delaying delivery or canceling it, and then the issue of the public image pops up, and they are thinking about ending up on the front page of a newspaper."