With a 40-year career in the aviation industry, Embry-Riddle alumnus C. Jeffrey Knittel (’80) has seen his share of ups and downs. The industry’s most recent plunge — caused by the coronavirus pandemic — is probably the worst he’s seen, he said. Despite the uncertainty inherent in his profession, the current chairman and CEO of Airbus Americas, Inc., wouldn’t choose another path.
“The aviation industry is different than almost every other industry I can think of,” he said. “It is going to go through a tough time, but we will get back to that [upward] trajectory.”
The guest speaker for Embry-Riddle’s inaugural Aviation Outlook Webinar held May 13, Knittel discussed ways Airbus has adapted to the pandemic and provided his thoughts on the state of the industry and its road to recovery.
“This industry will without a doubt be back; the timeline is the question,” said Knittel, who has been in his current role at Airbus since January 2018.
Presented by the deans of aviation, Alan Stolzer (Daytona Beach Campus), Ph.D., Tim Holt, Ph.D. (Prescott Campus) and Ken Witcher, Ph.D. (Worldwide Campus – College of Aeronautics), the webinar was attended by 480 virtual guests and was moderated by Assistant Professor of Aeronautical Science Bob Thomas, Ph.D.
The COVID-19 virus hit the industry globally and dramatically, Knittel said, and it’s hard to predict when people will feel safe traveling again. “Revenue passenger miles at one point were down 90%. This is a high-fixed-cost business … This puts airlines in a very difficult situation,” he said.
Still, Knittel remains optimistic. “I think, fundamentally, aviation is intrinsic to economic growth and also to people’s desire to see the world and see other people,” he said. “At a point in time, those things will come together to drive aviation forward.”
To accelerate that process, Knittel predicts the industry will coalesce around educating the public regarding the safety benefits of flying. “When you’re in an airplane, the air is recycled every two to three minutes, and it’s going through HEPA [high efficiency particulate air] filters, so you have a 99.97% efficiency. It’s hospital–like cleanliness,” Knittel said. Additionally, the airlines are using long-lasting disinfectant solutions to sanitize the aircraft cabins.
“When they are educated, people will realize it is safe to fly.” But the rebound might be slow, Knittel said. And airline safety isn’t the only factor that will determine a market turnaround.
“People need to feel comfortable going to airports, hotels and restaurants — so, holistically, the travel industry has to come together,” he explained.
For Airbus, Knittel said the pandemic represents a slowing, not a full-stop. “The industry as a whole is pulling back – slowing things to maintain our balance sheets,” he said.
Airbus is positioned well to weather the economic downturn, Knittel maintains. The company was already growing its manufacture of smaller, more efficient aircraft. In 2019, Airbus announced it would permanently halt production of its A380 wide-body aircraft. And, production of its A220 narrow-body, twin-engine aircraft is now in full swing at its Mobile, Alabama, final assembly facility.
“As we’ve entered this horrendous phase through the COVID situation, we think the A220 and the A320 family of aircraft [with their smaller passenger loads] will be in great demand,” Knittel said.
Airlines will likely take some older models out of the system, in place of more efficient ones, he added. The demand for international travel is worse than domestic travel, so the need for bigger aircraft is lower.
Knittel said Airbus’s diverse business model, which includes helicopters and a global defense company, is also helping the company weather the current crisis.
Although corporate budgets may be tighter in the near term, research into new technologies – including hybrid electric aircraft with lower carbon emissions and Urban Air Mobility vehicles – will continue, he said, and universities will play an important role in that innovation.
For students and alumni in the aviation industry, Knittel said it helps to have a breadth of knowledge to get through a downturn. Having a business background or being open to other areas of the industry, including more resilient sectors like defense, can open up more job opportunities, he said.
“Aeronautics is a broad industry. There are various parts of the business that are still going and having that breadth of knowledge is really important in a difficult time.”
Knittel’s own career is proof of that. His first job after graduation was at Cessna Finance Company in North Carolina. The company assumed he had a pilot’s certificate since he was an Embry-Riddle graduate, but he didn’t. Cessna ended up paying for his flight training so he could fly a company plane to visit regional dealers across the country.
“I was a 25-year-old young man and, instead of a company car, I had a company airplane,” Knittel said.
His successful career in aviation finance started after he was recruited a few years later to work for Manufacturers Hanover Leasing Corp., which at the time was the world’s largest bank-owned leasing company. Starting in 1986, Knittel held a series of senior leadership positions at CIT Group Inc. – most recently as president of CIT Transportation Finance – and later became CEO of C2 Aviation Capital, a global leasing company focused on acquiring, leasing and managing commercial aircraft. The company was sold, and Knittel briefly retired before being offered his current role at Airbus.
“It’s been great, and I will say Embry-Riddle was critical in that,” he said of his career.
Aviation is not the most stable and predictable industry, but it has never been boring, Knittel added.
“It’s an industry that’s impactful. … It’s an industry that’s essential to people’s way of life.”