Perth, Western Australia-based Maxem Aviation, began operations in 2003 with a CitationJet, primarily serving the growing local mining industry. Today, it is has expanded its fleet and serves a more international market.
Peter Nadilo, Maxem’s CEO and chief pilot, said he sensed a slight pickup in the aviation charter sector, which had remained quiet since the end of the mining boom. “I see an improvement...I see figures starting to show there is some degree of business activity higher than it has been in the last three years. I am quietly optimistic that we will start seeing business pick up. We don’t have much control; [it] is market-driven. What I can see is more and more people becoming knowledgeable in private aircraft transport because of where the airlines are at the moment,” he said.
In addition to its own Civil Aviation Authority of Australia (CASA) aircraft operator's certificate, Maxem provides aircraft management and operation, ground handling, aircraft hangarage, sales and acquisition, aviation consultation, flight training and medical relief flights. “It’s a very discreet, under-the-radar type thing, with Financial Review Rich List (BRW Rich List)-type clients, executives, entertainers, and HNWIs [high net worth individuals]. They require anonymity, discretion, safety, and a feel-good reliable service,” he said. In addition to leisure clients, the company continues to serve the mining market.
Maxem manages a Falcon 900, a Challenger 604, a Citation Encore +, a Citation Bravo and a Citation II and expects the Falcon to be upgraded to another model, possibly the 7X, soon. That reflects a significant decline in fleet numbers. Previously the company also had a Challenger 600, 601, and the Challenger 850. "They all went in the downfall of the business community here in the last three years or so," Nadilo said.
“The fleet has been static for the last three years. It’s reduced quite considerably…There were guys with a high net worth through mining who are now not around. The airplanes are the first to go. It was scary. That’s the comment I make on Western Australia: huge fortunes; huge falls. Boom or bust. It was so high that when they fell, they fell a long way.”
With the resources industry acting as the backbone of Western Australia's economy, mining, and oil-and-gas still play a big part in Maxem's work. “Mining is 60 percent of charter, while oil-and-gas would be 40 percent. We are high-end fly-in, fly-out. We provide back up for the old Fokkers.”
Aircraft management in Australia often means a good deal of charter to offset operational and management costs. He estimated some 60 to 70 percent of owners want some return.
“I haven’t figured out how to make money on corporate jets, and nor has Warren Buffett. [T]here is no doubt that the returns are intangible, as the clients keep updating their aircraft and continue to use them for their business. Clients say to me, ‘The more charter you get, the better’,” he said.
“So when the aircraft are not required by the owners, they are used for charter, search and rescue, air ambulances, short-notice medical, and freight to name just a few. This provides a revenue source that has pleased the owners to no end. And it has also benefitted the community. We were called out [recently] to Christmas Island on a road accident. The whole task was completed in nine hours. We covered 3,300 nautical miles.”
“People always have this perception, right or wrong, that it is expensive to charter a private aircraft. But when they…can go to six different locations in one day and then return home, that is incredible. [Customers have told us,] ‘That is just the most profitable day we’ve had with our clients, bar none.'”
