DAVID LEARMOUNT / LONDON
The training sector has not escaped the industry downturn - but a latent pilot shortage is expected to bring business back with a rush
Pilot-training schools have to be structured to survive flood and famine. In cyclical downturns, training is traditionally one of the first sectors where airlines look for cost cuts - and one of the last to see re-investment when the upturn comes.
Until the US economy began to falter in late 2000, airlines had enjoyed the longest period of relative plenty in their history, according to the International Air Transport Association, and the training industry could have been fooled into feeling that a period of stability had arrived. By April last year, however, European airlines were beginning to see their traffic figures turn down - albeit by less than carriers on the western side of the Atlantic.
Then the terrorist attacks of 11 September came, with US airlines hit hardest. Even in sectors such as the no-frills market - where the effects were less dramatic - the industry instinctively retrenched while it assessed the repercussions on customer confidence of a uniquely shocking attack.
Among the US schools, the world's biggest flight-training organisation, Flight-Safety International, says that self-sponsored training has fallen about 15% in reaction to the drop in regional airline hiring, and that the airline transition training market "went into hiatus" after 11 September and is still down.
Embry-Riddle Aeronautical University, however, says that the number of applicants for its four-year airline pilot bachelor of science degree course has increased slightly on last year. A welcome side-effect in the airlines' hiring slowdown is that the US schools have been able to retain instructors for longer before they are tempted away by the airlines, building up a buffer of instructor experience that had almost been exhausted before the downturn came.
Since 11 September schools globally have had to vet would-be student pilots. In the USA, the authorities' response to overseas applicants has been so bureaucratic that trainees, who previously flocked to the country, attracted by low prices and good weather, are being discouraged.
Peter Moxham of the European Association of Airline Pilots Schools says that one of its members, the UK's Oxford Air Training School, found its students grounded for 12 weeks while they awaited security clearance. (The school runs a base at Tyler, near Dallas, Texas, for US trainees and for the fair-weather-flying part of its Oxford-based students' European Joint Aviation Authorities licence course.) None was eventually refused, but it was an unwelcome intrusion into their training schedule. Meanwhile Middle Eastern carriers Emirates and Saudi Arabian Airlines have withdrawn students from US-based schools.
Some European flight-training schools, like some European airlines, have collapsed. Peter Newman, general manager of Jerez, Spain-based BAE Systems Flight Training, says: "Others will go. You need an understanding holding company at a time like this. If you're small and on your own, or are owned by a firm with a short-term view, you're in trouble." He says Jerez is fortunate because BAE Systems is in flight-training long term, with bases in Australia and Europe serving civil and military customers.
Newman sees an upturn on the way. While he acknowledges that schools have not yet seen the benefits, he says that airline and customer confidence are showing signs of returning. He believes that it will be 2004 before the airlines realise - "too late as usual" - that they have to start investing in training again because, by then, the pilot shortage that has been threatening for years will have arrived.
But, he adds: "When the good times return it will not be the same." He says that, in the new, leaner, meaner world, the blue-chip Western European airlines that usually sponsor the training of some of their ab-initio pilots may no longer be able to afford that luxury.
Like Germany's Lufthansa and Australia's Qantas, which have already made the change, airlines are now likely to choose a favoured school, select candidates, then require students to pay for their own training. But at least the students then have the motivation of a guaranteed job at the end of the road if they succeed at all stages, and this makes finance easier to raise. Overall, Newman believes the day of self-sponsored students as the primary source of airline recruits may finally have arrived.
There will still be airline sponsorship, he adds, but it will be by national flag carriers which have relied a great deal on experienced expatriate pilots and believe they have a duty to train their own nationals as pilots. Often these airlines are based in countries where it would be difficult or impossible for students to raise money for a full course of training.
Meanwhile, says Newman, the low-cost carriers, such as Brussels-based Virgin Express, Ireland-based Ryanair, and the UK's Buzz, EasyJet, Go and start-up Bmibaby, are continuing to expand apace. They have traditionally got their junior pilots from the regionals and the self-sponsored market, and have attracted senior pilots and captains from other airlines with competitive salaries and even "golden hellos" for type-rated training captains. If their success continues into the approaching market upturn, Newman adds, they will soon have to consider some kind of ab initio training plan, or their growth potential will be stunted by a shortage of flightcrew.
Training schools in France have seen a dramatic drop - up to 50% - in student numbers, but they blame the cyclical downturn in the aviation industry, rather than the events of 11 September.
According to DGAC, the French civil aviation authority, the principal reason lies in the move to the European Joint Aviation Authorities pilot-training curriculum, which took effect in July 1999. France had three years to adapt to the new syllabus, so "we are probably in the trough right now, with students hurrying to finish before the new norms become obligatory - and others not starting until the new norms take effect so as not to have a change mid-way through their training course." But it concedes that there has been very little recruitment for theory classes since 11 September.
Michel Montbrun, president of Aéro Pyrenées, a school based in Perpignan, southwest France, which performs ab initio training, says: "In October, November and to some extent December [last year], we had a brutal drop of between 40% to 50% in our student body." This consisted of 60% fully-sponsored students and 40% self-sponsored - "or, rather, students sponsored by their parents, who, right now, are not very willing to invest around Є45,700 [$40,200] in the airline business over 10 months".
ESMA, based near Montpellier in southern France, also offers ab initio training. "Things are very quiet," says training manager Jean-Yves Quentric, who puts the current situation down to "economic prudence" on the part of airlines. One of ESMA's principal clients was the now-defunct Swissair - Quentric does not think 11 September has had much effect on recruitment.
The DGAC says French training schools recruit most of their students from within France or French-speaking countries. "We have a language barrier. All the schools teach in French, their documentation and so on is in French, and for many it's just not worth the expense to translate everything into English.
"Of course some schools are perfectly able to dispense classes in English and will do so for major contracts, such as recent ones we have had with China and Vietnam where all the teaching was done in English," the DGAC adds. "But the fact that we are eliminating potential students because of [the Francophone bias] bothers us, and it is something we're working on."
South-East Asian airlines say they expect to double their fleets over the next 10 years, and several of them already rely heavily on expatriate pilots to make up the shortfall in fully trained national pilots.
The cost of training at foreign schools, however, is forcing larger countries to consider creating their own, or expanding those that already exist, such as Thailand's Civil Aviation Training Centre (CATC), which is where most of Thai Airways International's ab initio pilots were trained. CATC is a government agency run by the Department of Aviation (DOA). It is one of the oldest schools in South-East Asia, and probably the best funded.
But since 11 September, foreign students have not been accepted at CATC, which says it relies on airlines to investigate the backgrounds of Thai students they are sponsoring. Self-sponsored Thai students are only allowed to receive training if they are approved by the DOA.
The Philippine Airlines Aviation School (PAAS), which mainly serves Philippine Airlines (PAL), has not excluded foreign students and, in fact, would like to attract them. With a cost of $25,000 for a US Federal Aviation Administration commercial pilot licence syllabus course - about half the Western price - PAAS is highly competitive, but has not worked seriously at marketing its services overseas.
The PAL security office passes on details of all native and foreign cadet pilots at the PAAS to the police, the national investigation bureau and the office of air transportation, which conduct investigations locally and overseas before approving students, says manager Mariano Meneses.
Keith Morgan, marketing manager for BA Systems Flight Training School in Adelaide, Australia, has well-defined views on how the market is likely to develop. He says: "I think there will be a redistribution of training globally. There's been a slight reduction, but what we lose in one area of the world we may well pick up in another. Delegates from mainland China have been doing exactly what Emirates were doing; that is, travelling the world looking for potential training partners." Emirates has just switched its ab initio training from the USA to Australia. "I can't help wondering if there won't be a bit of a shake-up," adds Morgan, "because although security will change everywhere, I think it will change in the USA more than anywhere else.
"I'm uncertain whether foreigners have been frightened off training there, or whether the regulators are making it more difficult. I suspect a bit of both, and that concerns over cultural backlash has probably been at the front of peoples' minds when choosing a training location."
On local security changes Morgan says: "My belief is that the [Australian] Immigration Department has done a good job in vetting student visa applications. Because of some overstay issues they've had in the past they have strengthened checks anyway, and I think it's pretty good now. Immigration are changing the way they do things with online student acceptance. I wouldn't be surprised if globally all these people are networking more than they did."
Sue Davis, managing director of Aerospace Aviation, Bankstown, which specialises in self-funded student training, says: "Most of our overseas students are self sponsored - we don't have airline contract work, which goes to places like Adelaide. However, we've had some very keen people wanting to start training - but they've had a lot of difficulty getting through the Australian High Commissions in their own countries, for a number of reasons, some of which I don't believe appear to be valid."
She adds: "I've had a circular from the Australian Council of Private Education & Training, a body for all sorts of training providers. Its members have also had problems regarding the availability of visas to intending students". Davis cites one example where "a fellow got [refused] because he didn't have an international English language score of 6 or more, although he went to school in England. He's from Sri Lanka - which [immigration] obviously regard as a high-risk country."
Demand holding up
On the whole, however, Davis says demand is "very similar to pre-11 September. We still get phone inquiries from our traditional market, as well as occasional inquiries from Europe, which tend to be seasonal - and Australia has always been the preferred location for airline training within the Asian area. We were just getting into the Gulf area as a market. They have always gone to England - but the cost of English licences has become so expensive that they've had to look at alternatives. People we got from that area after 11 September were all visited by ASIO [the Australian Security Intelligence Organisation]. I have no problems about that - but we haven't had any new students from that region since 11 September."
Professor Graham Hunt, head of the school of aviation at New Zealand's Massy University, says: "We expected a significant drop in student interest and applications after 11 September, particularly in the undergraduate air-transport pilot degrees. In fact, there has been minimal change, maybe a couple of percentage points. What has happened is there has been significant interest in pilot training at Massy from other countries, and I think there are a number of schools in the USA, which have had restrictions in the areas where they conduct flying training - anywhere near nuclear power stations and so forth.
"But in airline contract training, there seem to be many airlines in South-East Asia and China who are nervous about sending their students to the USA," mainly because of personal security concerns.Western Michigan School of Aviation Sciences, which has UK Civil Aviation Authority approval to train student pilots for the European pilot licence, failed to respond to questions about the state of that market in the USA.
Additional reporting by Christina Mackenzie and Paul Phelan
Source: Flight International