ch-aviation interview: Stuart Wheeler, CEO Seawings

Seawings is a Dubai-based charter specialist. Launched in 2007, it deploys a fleet Cessna 208 Caravan Seaplanes mainly on charter flights for tourists in Dubai.

ch-aviation´s Ivan Nadalet had the possibility to chat with Stuart Wheeler, CEO at Seawings, about the carriers operations and future plans.

Stuart, can you give us a bit of background on yourself. How did you get into aviation?

I’ve been in aviation all my life actually. I started at a very young age when I was a student in England, so I’ve always had the smell of Jet A1. I then worked for 12 years for a company called Dan-Air which was one of the large independent UK airlines.

There, I ran the turboprop aircraft – four or five of them – and we built it up to a fleet of 18 servicing the North Sea Oil market which was booming in the ‘80s. I left there and went to Airbus in the Gulf and Asia. I then settled here in Dubai in 1989 and set up home here in the Airbus office. I was with Airbus for 10 years and lead the teams to sell into Emirates and (other airlines in the region). In fact, I arrived here January 1, 1986 and we signed an MOU with Emirates in June 1986, I think it was, and delivered the first two A310s in similar time in ‘87. I continued with Airbus until 1994 by which time we had about 13 airplanes delivered.

Then I left to set up Air Charter International which was getting back to my roots; focusing on wet-lease. At that time, wet-lease really wasn’t a business tool for airlines but it has grown into that. We have been running wet-lease operations now for 20+ years alongside our charter and leasing teams.

Tell us about your Seawings/Jet-Ops air charter operations.

It’s bit of a history really. Up until 2005, the UAE restricted AOCs to government entities such as Emirates, Etihad etc. There were no other areas to operate in and at that point, I think, the authorities came under pressure to provide a framework for regulations for other operators, because there were all sorts of companies here from all over the place. That is not good for a number of reasons-security among them.

The GCAA (General Civil Aviation Authority of the United Arab Emirates) then accepted applications from several parties. As I had a good relationship with the Dubai Civil Aviation dating back to my Airbus days, we applied for and were granted an NOC and later an AOC by the GCAA. We then had to decide what to do with it. We looked at a number of options including executive jets, but I didn’t want to do that as that would have put us into competition with some of the operators we were using at that time which wouldn’t have been good for business.

Then it occurred to us. We had placed a sea plane in Sri Lanka in 2000. The Sri Lankan Chief Executive was mulling how to improve domestic mobility for tourists and then had an idea; why don’t we get a sea plane? The Chief Technical Officer was Canadian and had some experience, and we were providing wet lease aircraft to them, so he looked at me. I found a seaplane and we facilitated a wet lease in. It was a good experience of what a Cessna Caravan looked like and what it could do.

Then, it was some time after that that I was in Canada watching the airplanes at Vancouver and with an eye on Dubai’s developing tourism market, I put two and two together. In 2007, we started with three airplanes which we still operate to this day.

Copyright: Seawings

Why the Caravans in particular? Did you ever consider any other types such as the Twin Otter?

I think at that time we didn’t quite know how big the market was. In retrospect, the Caravans have proven to be the right airplane and have provided us the facility to serve several different markets simultaneously. They also offer redundancy, a key issue for us.

You mentioned that these are the same three aircraft that you have had since the beginning. Have you considered fleet renewal or expansion plans as yet?

We’ve got a fourth airplane, also a Caravan, which is on lease from a Swedish firm, Grafair, for the winter months. I guess that will be a repeat process if we are allowed to do it, or we will have to purchase a fourth aircraft. Three airplanes can generate a lot of seats in a day.

How do your aircraft respond to the very hot and humid conditions here? What about the issue of corrosion?

We are particularly subject to it because we are in the water. As a result, we invest heavily in maintenance. In the summer we soak the airplanes with supplementary maintenance. But one of the challenges we’ve found in the UAE is that there are no AMOs (Approved Maintenance Organizations) for our type of aircraft. There are a few facilities like Jet Aviation but they are more geared towards light work on executive aircraft. So we decided we needed to do it ourselves. We’ve now got our own Part 145 approved maintenance facility and we employ engineers from around the world. We are building our own hangar at the moment at Jebel Ali, which should be completed by September. Currently, we lease space from a helicopter operation at Dubai Al-Maktoum Airport, so by September we should be in our own hangar.

Copyright: Seawings

You mention your manpower base is globally sourced. Have you begun introducing local Emiratis a-la the government’s Emiratization drive?

Yes, we employ Emiratis, in fact our Security Manager is an Emirati. Our experience has been very positive and we would be delighted to employ more.

Concerning the development of young pilots, we are a single-pilot operation and therefore every seat on the aircraft is precious. In bigger carriers like Emirates, locals can climb through the ranks by virtue of the right-hand seat. But with a single-pilot operation, it is quite difficult to do that. Having said that, we are starting an EASA-endorsed ATO (Approved Training Organization) for seaplane type-rating. We should have that up and running by the fourth quarter of this year.

RotanaJet has offered regular services within the UAE in the past. Have you considered branching into the scheduled services sector?

No. We are not authorized to be a scheduled operator.

Is your AOC restricted to charter operations then?

Yes, only national airlines can offer scheduled flights and we are very clear that we are a charter operator.

Copyright: Seawings

What about scheduled charters?

We fly on-demand. We obviously have a high-level program which we work for internal purposes on a scheduled basis with open flights as demand requires. We are definitely a tourism-based charter company, so what we do is offer packages such as a day trips to Sir Bani Yas. We are now developing our tour operations as Seawings which is, in actual fact, a tour operator. Jet Ops holds and manages the AOC while Seawings packages the product and markets.

How many waterdromes are there here in the UAE?

Fifteen, all developed by us (plus all the airports).

Are they all along the coast or also in the interior, like Al Ain?

No, not Al Ain. We have Dubai Cruise, Creek, Jebel Ali, Dubai World, Abu Dhabi, Yas Islands, Emirates Palace, Abu Dhabi Cruise, and Sir Bani Yas Island which is further out. The other way: Sharjah Lagoon, Ras Al Khaimah Creek, Al Hamra and Marjan Island. On the East Coast: Al Dana near Dibba, Khor Fakkan and Fujairah. Each one of them is in calm waters, and that suits the Caravan perfectly.

We have developed each of those water strips and each one has been a challenge. For every strip, we had to get approval and to convince people and that takes one to two years to do. It’s a huge amount of work.

Who forms the bulk of your customer base? Are we talking about the high-end income earners?

It’s a mix. We get all nationalities – British, German, Indian, and the Chinese are big at the moment. But while it is certainly a premium product with flights costing 1600 Dirhams, you would be surprised at the spending patterns. Some people might stay in a three or four-star hotel and can afford something like this. Others stay in a five-hotel. So there is no fixed type or income bracket.

The UAE is a petroleum-based economy. Have you seen any slow-down in demand as a result of the drop in oil prices and its impact on the country’s economy?

Dubai’s market is not petroleum reliant but rather business-orientated and a major global aviation hub. The economy is really driven by business and associated services such as the finance industry, medical and general tourism etc. Dubai is a very unique model. You’ve got 70 million people coming through the airport annually and maybe 25% of them stay here for one reason or other, and they are our market.

With the strengthening of the U.S. dollar and the weakening of the Euro, have you seen a shift in the origin of your international market?

Of course. Britain is still number one, Germany is still number two, India has come up, and the Chinese have hit us like a tsunami!

We’ve discussed your domestic operations but what about expansion abroad?

Well, we’re looking to expand into Oman next year.

How is that going to work from a technical point of view? From our understanding, entry into Oman is only though designated international airports.

Yes, those are some of the issues we have to solve.

Can you expand on the project? Will it entail pursuing an Omani AOC?

I don’t want to be too specific. Just say that Oman is on our radar, and for now what we will do, for example, is offer holidays as a combination between Dubai and Oman, so then we can fly into Oman. Whether it will be on wheels or on floats, we are working through that.

Given that your core market is tourist-based, how do you handle seasonality and how do you mitigate its effects?

Well the big peak season starts in October and carries on through to about the middle/end of May. Of course, within the peak season, we have a couple of very busy periods when demand spikes: Christmas, New Year, and then the Chinese New Year. The summertime has historically been very quiet although we are seeing a rise in traffic at present. How do we deal with that? We plan our maintenance accordingly; we try to undertake and wrap up all our major MRO requirements during the summer months.

We have some flexible arrangements with our engineers so that we will have, perhaps, more engineers during the summer months than in the winter months. The same applies to our pilots. This year, we had seven pilots during the peak season, but our core is four. Each year we decide how many pilots we need to add and take it from there.

What we want to develop is a business policy plan in a market where the seasons are reciprocal, i.e. Europe. In 2011, we created Jet-Ops Europe in Bulgaria and placed an aircraft on its AOC in order to facilitate operations in Europe. But since 2011, the European market has not been so good. Of late, we’ve seen some bright prospects and possibly, in the next year or two, we may see at least one aircraft, maybe two, going to Europe in the summer, but nothing has yet been decided.

Copyright: Seawings

Is Jet-Ops, under the Jet-Ops Europe AOC, planning to offer its own services there in Europe or are you looking at working with other seaplane operators by exchanging aircraft on a seasonal basis like some of the major charter airlines do by alternating between Europe and Asia/the Caribbean?

There aren’t so many [seaplane] operators in Europe, so we have really got to plough our own furrow. Those that are in Europe tend to have their own business models, which maybe better suited to the Twin Otter than the Caravan. There really aren’t so many options to equip other operators. It’s a matter of developing something new, but definitely we want to work with partners, generally companies that have distribution or an interest in starting a sea-plane service but don’t want the overhead of having an airplane all year-round. While owning and operating a seaplane is a passion for some people, the fact is, if you can’t keep your airplanes occupied on a year-round basis, you carry this enormous overhead.

Are you just looking at Europe or are you also looking at other areas for growth? Are there any other places in the world where you would try replicating your business model or is it really only suited to Dubai?

I think that’s our first priority. But, while we can expand in Dubai, there are also Abu Dhabi and Oman where there’s decent potential. In terms of WOW! Factor, Dubai has all the attractions needed to charge the prices we do and this generates sufficient revenue to cover the high cost of our operations. You have to have not only water, but also something that’s really scenic; that’s really interesting to look at, and these are ‘must do’ activities. Throughout the world, you can find other places which have got water and some attractions but the question is, will people pay the price, in the volumes that you require, to establish your operation and the answer is not always yes.

With this in mind, again and again, we come back to Dubai and Abu Dhabi which have growth potential and the WOW! Factor. So better to focus on the market that you know and can grow in; we don’t want to conquer the world. But, if an opportunity were to arise elsewhere and if it were to have all the commercial engines I’ve described – good water, some WOW! Factor or a mandatory requirement to have to travel by seaplane – then we would have a look at it. Otherwise, the first priority is to find a reciprocal business partner in the summer months.

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