Wilson Cobbett Ltd during 1870s (Yahoo Finance 2007). With this humble beginning, the business organization has risen to become one of the world's recognized aviation companies capitalizing on its leading market position and strong growth potential. BBA Aviation reports annual sales of 1 million, employs approximately 10, 700 individuals, and operates in 11 countries. The company's major markets include the United States, Asia, the United Kingdom and Europe, while maintaining its headquarters in London, England (BBA Aviation Plc 2007).
BBA Aviation Plc focuses on the provision of flight support services and aftermarket services and systems. The company's Annual Report 2006 states that it focuses on extending primary services such as "providing flight support to business and commercial aircraft at almost 150 locations worldwide; overhauling turbine engines together with the supply and repair of related components; licensing components from OEM s [Original Equipment Manufacturers] and assuming responsibility for their support in the Aftermarket; designing, manufacturing, and repairing of aircraft landing gear and hydraulic systems; and training pilots and the provisions of other services at Oxford airport."
During 2006, BBA Aviation reports a total turnover of 950.1 million, 556.4 million (59%) of which is shared by its flight support division while the remaining 393.7 million (41%) is accounted for by its aftermarket services and systems (Annual Report 2006). Figure 1 further divides the company's total turnover in 2006 among its business units.
Figure 1. Shares of Business Units in BBA Aviation's Total Turnover
(2006, in million)
III. The Global Aviation Market
Armed with its commitment in the provision of excellent products and services to its customers and its cultivated expertise gained through its experience in the market, BBA Aviation is recognized as one of the leaders in the global aviation market. Based on the total value of its turnover in 2006, BBA Aviation's biggest market is the business and general aviation market which accounts for 65% of its total revenue. The company also captures a large share in the commercial aviation primarily on flight support as this segment provides 30% of its turnover. The business organization has a very limited presence in the military market which shares a meager 5% to its gross earnings (Annual Report 2006).
Figure 2. The Markets of BBA Aviation
(based on sales percentage)
A. General and Business Aviation
The company's operation in the general and business aviation market has been challenged by the historically high crude oil costs coupled with the rise in average retail jet fuel prices. Amidst these threats in the market environment, BBA Aviation Plc reports a generally "robust growth" as "business aircraft utilization recovered and remained strong" after the "temporary softening in flying hours during the early 2006" (Annual Report 2006). The business organization's outlook for this market segment is bright as demand for its products and services are expected to rise driven by "the continued growth of traditional corporate flight