March 19, 2007
Here come the big jets | Oxford Aviation banks on a $10 million Sanford facility as a way into the lucrative business jet market
By Zack Anchors
Over the years, more and more pilots have set their controls to Oxford, Maine. They come from all over the world, nosing their small craft onto the Oxford Regional Airport runway and into one of the two hangars run by aircraft refurbishing company Oxford Aviation. They come from as far as Scandinavia and Brazil to have the interiors of their planes stripped and updated with new seats and cabinetry, new avionics, or a new exterior paint job to cover the wear and tear of hundreds of hours of flight time.
It's an elaborate process, refurbishing a plane, and owners have very specific ideas about how they want their planes to look and feel. And that's what brings them to Maine, according to Oxford Aviation CEO Jim Horowitz. Despite Oxford's relatively remote location, the company's devotion to such details is what has kept their customer base expanding. "People wonder why someone would bother flying to Maine for something like this, but those geographic borders are pretty transparent to aircraft," says Horowitz. "To avail themselves of world-class craftsmanship, for work that's going to take three or four months, flying a few hours to Maine isn't a big deal. Especially since that's what these planes are designed to do."
And Horowitz believes he can lure more ˆ and bigger ˆ aircraft to Maine after the company completes its $10 million facility under construction in Sanford. The new facility will solve one big problem at the company's Oxford location: space. The Oxford airport's runway extends only 3,000 feet ˆ a length suitable for landing only smaller aircraft like an eight-passenger Cessna Citation III. Oxford has drawn in plenty of business from that clientele ˆ the company has worked on more than 4,000 aircraft since launching in 1989, says Horowitz, with the average plane requiring between 500 and 1,000 hours of labor.
But Horowitz has had his eye on the fast-growing small-jet market, which includes planes like Gulfstream V's that require significantly longer runways to land and take off. Last fall, he found the right match at Sanford Regional Airport, best known as Air Force One's preferred landing spot in southern Maine. The airport has 5,000-foot and 6,000-foot runways, along with dozens of acres available for development.
Once Oxford's 70,000-square-foot refurbishment facility opens next December, the company will still service its previous, smaller, clientele in Oxford, but will also have an entirely new ˆ and potentially lucrative ˆ market open to them in Sanford. At its Sanford facility, Oxford expects to work on 50 aircraft a year, with services ranging from minor touch-ups to complete overhauls that cost millions of dollars ˆ and up to a year ˆ to complete. (Though the company won't get into specifics, Kimberly Clarke, business development director at Oxford, says revenues are "in the millions" and that the company is profitable.)
Meanwhile, Sanford officials are hoping that Oxford's decision to move into town is similarly lucrative. When Oxford announced last fall its plans to expand into Sanford, the 200 well-paying jobs the company expected to create were alone a huge victory for the small town that for decades has been struggling to regain its economic footing after suffering a spate of factory shutdowns.
And Sanford officials made sure to sweeten the pot for Oxford: The town wagered millions in tax benefits and matching grants to lure the company in hopes that it would bring good economic news to the town. And beyond the direct impact on the local economy, some people see Oxford's expansion as potentially having a much broader impact. The anticipation of town officials, company management and local business people was captured in recent months by one oft-repeated phrase: aviation industry cluster.
The hope, says Horowitz, is that the company's new state-of-the-art operations in Sanford, along with the explosive growth of the general aviation industry as a whole and the existence of a range of aviation-related companies in Maine, will allow a network of interrelated aviation businesses to flourish. "General aviation is doing nothing but expanding exponentially, and Maine has the chance to become one of the important aviation centers of the country," says Horowitz. "We're really interested in working with the state and the town to encourage cluster-type aviation growth to sprout up around us."
It may be years until that vision of an aviation cluster is realized, but already the strength of general aviation industry ˆ which doesn't include military and major commercial airlines ˆ has been a boon to some Maine companies. (For more on building Maine's aviation cluster, see "Flight formation," this page.)
Oxford is a good example. Since opening a 6,000-square-foot hangar at the Oxford Regional Airport in 1989 with a workforce of 11, the company has grown steadily, with big expansions in 1992 and 1997. Today the company has 65 employees and a 40,000-square-foot facility at the Oxford County Regional Airport, as well as a maintenance and flight training facility at the Eastern Slope Regional Airport in Fryeburg. The company completes an average of 120 projects a year and often carries a waiting list of clients.
Sanford rising
After wading through decades of economic doldrums brought on by a string of big manufacturing losses, Sanford has experienced something of a rebound in recent years. Take the airport: Before Oxford announced its Sanford expansion, the 11,115-acre facility had seen plenty of action. Evan MacDougal, manager of Sanford Regional Airport, says 23 new hangars have been built in the last two years and 20 more are on their way.
And beyond the airport, Sanford is bustling with economic activity, says Les Stevens, Sanford's economic development director. Companies such as Central Tire, DM Technologies and Rubb Building Systems have all grown and substantially increased employment in recent years. "Sanford overall is very hot right now," he says. "And it's driven by location ˆ we're halfway between Boston and Portland. People don't realize that York County has grown 80% in the last 30 years."
Judging by the crowd that showed up for a job fair Oxford held last November, however, good paychecks are still hard to come by. Nearly 500 people attended the event at Sanford's Town Hall to apply for the 15 jobs Oxford had open at the time. The jobs, which ranged from entry-level to positions requiring extensive aviation mechanical skills, offered hourly wages between $18-$20. "The jobs ˆ that's the number one reason we're excited they're coming here," says Sanford Town Manager Mark Green.
Green says that he also believes Oxford is likely to spur economic activity throughout town, and to bolster efforts to revive Sanford's downtown center and bring higher-value uses into the town's old mills. "We want to see the airport continue to be used for general aviation, but we also want aviation-related industries to be attracted there," says Green. "And if we can attract good employment to that area of town, that will have a big impact on the sale of goods and the housing market. People will have discretionary incomes they can distribute throughout the community."
Green and other town officials were confident enough in Oxford's promise to create jobs and stimulate the economy that they were willing to provide substantial incentives to lure the company to town. Besides creating a tax increment financing district and working extensively with state and federal officials to obtain $1.4 million in federal grants and a state Pine Tree Zone designation for the airport, Sanford is also paying $250,000 out of town coffers and bonding $670,000 to help fund the public improvement necessary for Oxford's arrival. Currently, the town is tearing down old World War II-era hangars and preparing the site for Oxford's new facility.
Horowitz says Oxford's growing reputation in the industry makes him confident the expansion will be successful. But he also points to positive trends in the general aviation industry. Last year was a record year for general aviation manufacturers: $18.8 billion in airplane sales amounted to a 24.4% increase over 2005, according to the General Aviation Manufacturer's Association, a trade group based in Washington, D.C. What's more, sales of used aircraft ˆwhich often end up at a refurbishing shop like Oxford ˆ were strong.
The lure of micro-jets
A rising interest in corporate planes is helping fuel the strong growth in the general aviation industry, says Katie Pribyl, spokeswoman for GAMA. "When you look at some of the hassles and costs of flying on commercial airlines, it makes sense for businesspeople to invest in their own aircraft," she says.
And these days, planes aren't luxuries reserved only for the most well-heeled of corporations. Thanks to continued technological innovation, just in the last two years the industry has seen development of smaller, lighter and less expensive "micro-jets," which promise to further expand the general aviation market in coming years, says Pribyl. "We view very light jets as a natural downward extension of the market," she says. "It makes jets much more affordable to a broader range of the population."
An expanding micro-jet market is good news for companies like Oxford Aviation. That's because most micro-jets typically are outfitted with generic exterior and interior designs, meaning the first trip many buyers of micro-jets make in their new aircraft is to a refurbishing facility. That could mean anything from a new finish featuring a company logo to an elaborately crafted interior layout.
Clarke says there are many other companies that will be competing for the business Oxford is targeting with its new facility, including refurbishing companies like Nebraska-based Duncan Aviation and Illinois-based Elliott Aviation. But with the growth of general aviation as a whole and the abundant surplus of business for refurbishing companies, she's not worried about Oxford earning a share. In fact, at full capacity, Oxford's share of the refurbishing market is only at 1.6%, Clarke estimates. "There's far more business out there than there are companies to provide the services," she says.
Whether Oxford Aviation's expansion to Sanford serves as a catalyst to create a bona fide aviation cluster in Sanford or in Maine as a whole, the new jobs are enough to please local officials. But what may be more exciting is the prospect that aviation-related industries might offer a much-needed boost to Maine's manufacturing industry, and a chance for small towns like Sanford ˆ and small companies like Oxford Aviation ˆ to be the main beneficiaries.
For Horowitz, it's no accident that Oxford Aviation has found success in the aircraft refurbishment market. "Our company is just like the traditional manufacturing model, with almost all of the revenues flowing in from out of state," says Horowitz. "One reason we can do that is that we have something I find rare: People from Maine have a strong work ethic and care about their jobs. That I find unique."
It's an elaborate process, refurbishing a plane, and owners have very specific ideas about how they want their planes to look and feel. And that's what brings them to Maine, according to Oxford Aviation CEO Jim Horowitz. Despite Oxford's relatively remote location, the company's devotion to such details is what has kept their customer base expanding. "People wonder why someone would bother flying to Maine for something like this, but those geographic borders are pretty transparent to aircraft," says Horowitz. "To avail themselves of world-class craftsmanship, for work that's going to take three or four months, flying a few hours to Maine isn't a big deal. Especially since that's what these planes are designed to do."
And Horowitz believes he can lure more ˆ and bigger ˆ aircraft to Maine after the company completes its $10 million facility under construction in Sanford. The new facility will solve one big problem at the company's Oxford location: space. The Oxford airport's runway extends only 3,000 feet ˆ a length suitable for landing only smaller aircraft like an eight-passenger Cessna Citation III. Oxford has drawn in plenty of business from that clientele ˆ the company has worked on more than 4,000 aircraft since launching in 1989, says Horowitz, with the average plane requiring between 500 and 1,000 hours of labor.
But Horowitz has had his eye on the fast-growing small-jet market, which includes planes like Gulfstream V's that require significantly longer runways to land and take off. Last fall, he found the right match at Sanford Regional Airport, best known as Air Force One's preferred landing spot in southern Maine. The airport has 5,000-foot and 6,000-foot runways, along with dozens of acres available for development.
Once Oxford's 70,000-square-foot refurbishment facility opens next December, the company will still service its previous, smaller, clientele in Oxford, but will also have an entirely new ˆ and potentially lucrative ˆ market open to them in Sanford. At its Sanford facility, Oxford expects to work on 50 aircraft a year, with services ranging from minor touch-ups to complete overhauls that cost millions of dollars ˆ and up to a year ˆ to complete. (Though the company won't get into specifics, Kimberly Clarke, business development director at Oxford, says revenues are "in the millions" and that the company is profitable.)
Meanwhile, Sanford officials are hoping that Oxford's decision to move into town is similarly lucrative. When Oxford announced last fall its plans to expand into Sanford, the 200 well-paying jobs the company expected to create were alone a huge victory for the small town that for decades has been struggling to regain its economic footing after suffering a spate of factory shutdowns.
And Sanford officials made sure to sweeten the pot for Oxford: The town wagered millions in tax benefits and matching grants to lure the company in hopes that it would bring good economic news to the town. And beyond the direct impact on the local economy, some people see Oxford's expansion as potentially having a much broader impact. The anticipation of town officials, company management and local business people was captured in recent months by one oft-repeated phrase: aviation industry cluster.
The hope, says Horowitz, is that the company's new state-of-the-art operations in Sanford, along with the explosive growth of the general aviation industry as a whole and the existence of a range of aviation-related companies in Maine, will allow a network of interrelated aviation businesses to flourish. "General aviation is doing nothing but expanding exponentially, and Maine has the chance to become one of the important aviation centers of the country," says Horowitz. "We're really interested in working with the state and the town to encourage cluster-type aviation growth to sprout up around us."
It may be years until that vision of an aviation cluster is realized, but already the strength of general aviation industry ˆ which doesn't include military and major commercial airlines ˆ has been a boon to some Maine companies. (For more on building Maine's aviation cluster, see "Flight formation," this page.)
Oxford is a good example. Since opening a 6,000-square-foot hangar at the Oxford Regional Airport in 1989 with a workforce of 11, the company has grown steadily, with big expansions in 1992 and 1997. Today the company has 65 employees and a 40,000-square-foot facility at the Oxford County Regional Airport, as well as a maintenance and flight training facility at the Eastern Slope Regional Airport in Fryeburg. The company completes an average of 120 projects a year and often carries a waiting list of clients.
Sanford rising
After wading through decades of economic doldrums brought on by a string of big manufacturing losses, Sanford has experienced something of a rebound in recent years. Take the airport: Before Oxford announced its Sanford expansion, the 11,115-acre facility had seen plenty of action. Evan MacDougal, manager of Sanford Regional Airport, says 23 new hangars have been built in the last two years and 20 more are on their way.
And beyond the airport, Sanford is bustling with economic activity, says Les Stevens, Sanford's economic development director. Companies such as Central Tire, DM Technologies and Rubb Building Systems have all grown and substantially increased employment in recent years. "Sanford overall is very hot right now," he says. "And it's driven by location ˆ we're halfway between Boston and Portland. People don't realize that York County has grown 80% in the last 30 years."
Judging by the crowd that showed up for a job fair Oxford held last November, however, good paychecks are still hard to come by. Nearly 500 people attended the event at Sanford's Town Hall to apply for the 15 jobs Oxford had open at the time. The jobs, which ranged from entry-level to positions requiring extensive aviation mechanical skills, offered hourly wages between $18-$20. "The jobs ˆ that's the number one reason we're excited they're coming here," says Sanford Town Manager Mark Green.
Green says that he also believes Oxford is likely to spur economic activity throughout town, and to bolster efforts to revive Sanford's downtown center and bring higher-value uses into the town's old mills. "We want to see the airport continue to be used for general aviation, but we also want aviation-related industries to be attracted there," says Green. "And if we can attract good employment to that area of town, that will have a big impact on the sale of goods and the housing market. People will have discretionary incomes they can distribute throughout the community."
Green and other town officials were confident enough in Oxford's promise to create jobs and stimulate the economy that they were willing to provide substantial incentives to lure the company to town. Besides creating a tax increment financing district and working extensively with state and federal officials to obtain $1.4 million in federal grants and a state Pine Tree Zone designation for the airport, Sanford is also paying $250,000 out of town coffers and bonding $670,000 to help fund the public improvement necessary for Oxford's arrival. Currently, the town is tearing down old World War II-era hangars and preparing the site for Oxford's new facility.
Horowitz says Oxford's growing reputation in the industry makes him confident the expansion will be successful. But he also points to positive trends in the general aviation industry. Last year was a record year for general aviation manufacturers: $18.8 billion in airplane sales amounted to a 24.4% increase over 2005, according to the General Aviation Manufacturer's Association, a trade group based in Washington, D.C. What's more, sales of used aircraft ˆwhich often end up at a refurbishing shop like Oxford ˆ were strong.
The lure of micro-jets
A rising interest in corporate planes is helping fuel the strong growth in the general aviation industry, says Katie Pribyl, spokeswoman for GAMA. "When you look at some of the hassles and costs of flying on commercial airlines, it makes sense for businesspeople to invest in their own aircraft," she says.
And these days, planes aren't luxuries reserved only for the most well-heeled of corporations. Thanks to continued technological innovation, just in the last two years the industry has seen development of smaller, lighter and less expensive "micro-jets," which promise to further expand the general aviation market in coming years, says Pribyl. "We view very light jets as a natural downward extension of the market," she says. "It makes jets much more affordable to a broader range of the population."
An expanding micro-jet market is good news for companies like Oxford Aviation. That's because most micro-jets typically are outfitted with generic exterior and interior designs, meaning the first trip many buyers of micro-jets make in their new aircraft is to a refurbishing facility. That could mean anything from a new finish featuring a company logo to an elaborately crafted interior layout.
Clarke says there are many other companies that will be competing for the business Oxford is targeting with its new facility, including refurbishing companies like Nebraska-based Duncan Aviation and Illinois-based Elliott Aviation. But with the growth of general aviation as a whole and the abundant surplus of business for refurbishing companies, she's not worried about Oxford earning a share. In fact, at full capacity, Oxford's share of the refurbishing market is only at 1.6%, Clarke estimates. "There's far more business out there than there are companies to provide the services," she says.
Whether Oxford Aviation's expansion to Sanford serves as a catalyst to create a bona fide aviation cluster in Sanford or in Maine as a whole, the new jobs are enough to please local officials. But what may be more exciting is the prospect that aviation-related industries might offer a much-needed boost to Maine's manufacturing industry, and a chance for small towns like Sanford ˆ and small companies like Oxford Aviation ˆ to be the main beneficiaries.
For Horowitz, it's no accident that Oxford Aviation has found success in the aircraft refurbishment market. "Our company is just like the traditional manufacturing model, with almost all of the revenues flowing in from out of state," says Horowitz. "One reason we can do that is that we have something I find rare: People from Maine have a strong work ethic and care about their jobs. That I find unique."
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