[00:00:03] Philippe Lubrano: We are just trying to come up with solutions for client that do need for instance to trade in their old aircraft. Yeah, they will come to us and say, hey, I got these 206B3.
I'm looking at this H125 that is about 10 years old. You know, could you trade in right away? Well, we'll take the aircraft on trade. Cut him a check, just settle the balance and. And go. Yeah. So we are trying to make it easy for people.
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Welcome to the Hangar X Studios podcast and we are live at Verticon and you know we're having so much fun because we're getting to talk to some of the most incredible and intriguing leaders and innovators, doers and disruptors. And today we have Philippe Lubrano from Rototrade on and tell us a little bit about yourself Philippe and Rototrade because you are doing business all over the world.
[00:01:41] Philippe Lubrano: That's correct. And good morning. Yes, we've been starting this business about 12 years ago, first in the Far east, in Malaysia and Singapore and then we expand slowly, Europe, United States, Latin America and we just went where the market needed pre owned aircraft, maybe in a different way. We really wanted to offer something a bit more structured where we work with the OEMs and get certified pre owned a little bit like the automotive industry.
I think sometimes the automotive industry is inspiring for industry and we're trying to get closer to the client offer more comprehensive offer where we have warranties on the aircraft completion capability through our MROs. So we're trying to act really as a dealer. So yes, I mean the journey is.
[00:02:37] John Ramstead: It all pre owned or do you do some new owners?
[00:02:40] Philippe Lubrano: We do mainly pre owned, sometimes we do new but it's probably 10% of our activity maximum.
[00:02:45] John Ramstead: And what makes you guys, I mean there's some other people doing that. What makes you guys unique in that space?
[00:02:50] Philippe Lubrano: No, no, I think we're different unique. I'm not sure. But we're trying to Adjust on what the market wants is when we met actually THC as a client first about five years ago, they were an operator on the go. They were.
[00:03:04] John Ramstead: And that's the helicopter company out of.
[00:03:06] Philippe Lubrano: Out of Riyadh, Saudi Arabia. Correct. So they really wanted to have toolbox, someone who can really help them to, you know, take delivery of the aircraft, reconfigure the aircraft in order to make sure that they will get an aircraft ready to go on contract in Saudi. It was our, I mean primary function with them. Then they understand the kind of business model we had worldwide. And since they were pretty solid in Saudi Arabia, we offered to work together so they could have a global position.
They took a stake of the company first. In 2022 and 2024 they to 100% of the company.
From that day onward we build up a strategy together where basically we are four pillars.
[00:03:48] John Ramstead: Okay.
[00:03:49] Philippe Lubrano: We have the operations in Saudi and maybe soon outside Saudi we have the dealerships where basically you can come to us and we will offer certified pre owned on Leonardo, Airbus, Pradey, Whitney, Saffron, but regardless of the engine and we will have also MROs where you can actually complete the aircraft, put a new Garmin line in a re respray, install any, you know, specific equipment you'd like to see on board, reconfigure an aircraft.
And finally the force pillar which is the leasing company that we just announced. Yes.
[00:04:25] John Ramstead: Okay.
[00:04:26] Philippe Lubrano: So you come to us, it's like a one stop center. You can get your vehicle which you, I mean I say vehicle because the approach is very close to, to a car dealership. So you come, you choose your aircraft, you can try it, you buy it, we configure it, we deliver it wherever you are.
[00:04:43] John Ramstead: We also certify it, it's pre owned but pre owned certified. Right.
[00:04:47] Philippe Lubrano: And that's good quality and that's, I mean of course you know, you can find pre owned aircraft on the market that might be cheaper or that might be. Or that we might not have, which is fine.
We have decided to work with the manufacturers because we come from that industry.
[00:05:04] John Ramstead: But they, you know, I've bought pre owned, you know, fixed wings but you got to go find it and then it's usually you know, some airfield and then you got to go find some mechanics that you hope you can trust to go pay a lot of money to go through it and then they find some stuff and then you get the airplane and I own an airplane for about six months. Had so many gremlins I had to sell it. Right. So that's kind of the traditional aircraft buying process, isn't it?
[00:05:25] Philippe Lubrano: Correct, correct. And we. And we learn from that. Yeah. And we try. You know, we. We have also had bad experience. True as well. So we want to make sure that our customers do not have to go through that.
So it's an option. And we don't have everything. And we cannot always make everyone happy because you might not have the solution. But at least we're honest. We tell them what we have and what we don't have and we move them like this.
[00:05:48] John Ramstead: So leasing is something you're adding? It's a new development. Are there any future developments that you're considering?
[00:05:54] Philippe Lubrano: I think we are pretty much set now for the next five years. We have a target in terms of expansion now.
[00:06:01] John Ramstead: Okay.
[00:06:02] Philippe Lubrano: Especially in the United States, where we intend to grow from east coast to west coast with dealerships, maintenance facilities in order to be more regional. The helicopter is market is very regional. You know, you have the jet business where you can take a jet and fly to Europe, do maintenance, come back. I mean for helicopters it has to be very regional in a state or two states and that's it.
We cannot be everywhere.
[00:06:28] John Ramstead: So does it have like a different makeup and customer like LA versus Denver versus somewhere in the East Coast?
[00:06:36] Philippe Lubrano: I mean, you can see that the kind of operation you have a lot of twin engines in the Northeast, you have a lot of single engines almost Everywhere because it's 65% of the market.
[00:06:46] John Ramstead: But Europe is mostly twin engines because of some of the rules.
[00:06:50] Philippe Lubrano: Hello. That's true for more, more and more. True for public transport you still have a lot of single engines.
[00:06:55] John Ramstead: Okay.
[00:06:55] Philippe Lubrano: You still have a lot of guys that are doing tours in single eng that are private owners that fly their own aircraft or have a safety pilot and they use it. You have a lot of A stars 407s.
Even the 119 is pretty much used on the single engine market. So all of that is existing already. And then you have the legacy fleet. You have guys that love 206ers and they still fly them. You have seen all 350Bs flown as well. So for us we are just trying to come up with solutions for client that do need, for instance, to trade in their old aircraft. They will come to us and say, hey, I got these 206v3. I'm looking at this H125 that is about 10 years old.
Could you trade in right away? Well, we'll take the aircraft on trade. Cut him a check, just settle the balance and go. So we are trying to make it easy for people.
[00:07:48] John Ramstead: Yeah, it's like the Carvana of helicopters.
[00:07:50] Philippe Lubrano: Exactly.
I love that. Why do you want to make it more complex when you can make it and pretty straightforward?
[00:07:56] John Ramstead: So what do you. You know, the industry has had some ups and downs with the economy, Covid, things like that. Now we're. It's interesting kind of economic times, you know, right now, things that are happening. But what do you see the outlook in the helicopter industry or sales new and used over the next two, three years?
[00:08:14] Philippe Lubrano: I can tell you, until 2030. Till 2030, we're going to do extremely well.
[00:08:20] John Ramstead: Okay.
[00:08:20] Philippe Lubrano: All of us.
[00:08:21] John Ramstead: What's driving that you think?
[00:08:23] Philippe Lubrano: Few things.
Look, if you had a chance to speak to any helicopter manufacturers, he has an order book that is two to three years down the line.
[00:08:34] John Ramstead: So it's backlogged.
[00:08:35] Philippe Lubrano: So it's backlogged. Look at 2024. The performance they had in terms of delivery. They. They had record sales. And. And it's not going to stop. Why? Because the demand is getting higher. Look at the. I mean, you have geopolitical challenges, safety crisis, earthquake, floods, border patrol. You name it, you have it. And there is only a number of aircraft you can manufacture a year. So what's going to happen is for the next three to four years, you're still going to have long lead times on new products. So when you have a contract, when you have a job to do and you can't have access to an aircraft immediately, what do you do? You go to the PR market or you go to a leasing company if they have any aircraft available.
[00:09:21] John Ramstead: Well, we saw that during Hurricane Helene in North Carolina, there was a huge lack of helicopter assets and they were just limited.
[00:09:30] Philippe Lubrano: True. But there is another challenge. There is if you have an event like this and you need to mobilize a massive number of helicopter, only when it happens is what you do the rest of the year. So that's also a challenge. And that's not for me to say, but it's the challenge of every government around the world. You know, when you elect the government, you, you, you only complain in the bad times. You know, when everything goes well, you don't say anything.
[00:09:54] John Ramstead: That's true.
[00:09:55] Philippe Lubrano: So. So. But what I know is you have also process of the aging. Look at all the military around the world. You have massive aircraft that are 30, 40 years old. They have to replace them. And when you have tensions, everybody realize, oh, I need to protect my country, I need to protect my people, I need to support my people.
So in that case, they're going to start to order aircraft and they don't order one or two helicopters, they order 10, 20. And the capacity, I think the Airbus delivery last year was about 300. If you go to Leonardo, it's probably a bit, it's a bit less, but it's in 200, 250. But the thing is, if you have a capacity of 1000 helicopter a year is the maximum and people need much more, more than, more than that. So then they go to the pre. Own in. I remember Postco, you had about 1,600 aircraft for sale around the world. And today it's, it's, it's one third of that. Oh, it is, yes. So, so, and it's changing all the time. And, and some people decide to, to. They don't even list.
You walk in a hangar, his aircraft is being maintained somewhere and the guy says, is that, would you sell your aircraft? Because I need one. And then they flip it. You know, it's you. It's very difficult to monitor. But what I can tell you is vertical lift is everything right now. And when there is a disaster, when there is, and you just mentioned a hurricane, but you can have fires, you get, you need a vertical lift more and more. Any fast growing country who is building infrastructure, they need helicopters more than anything else. So to me, I'm quite confident until 2030 we're going to be doing very, very well.
[00:11:39] John Ramstead: And you were telling me before we hit record, like I asked you, where you're from, you're like, well, everywhere, because I live on an airplane. Because you're doing so much. So, you know, how are you and the team positioned? You know, maybe as we wrap up, what does it look like for you in a global context as you're also expanding?
[00:11:54] Philippe Lubrano: You know, I mean, we, we, I spend a lot of time on the plane. It's true. I'm, I'm in between Asia, the Middle east area, because this is where our headquarter is, and also Europe where we are building a serious industrial facilities to support our fleet development and our dealerships and Latin America, Mexico, we're going to open in Brazil very soon and of course the United States, where we are mainly based on the east coast, but we are expanding to the west and to the Midwest as well. So we're trying to be where we can be and where we should be is much more than that because I believe that the number of dealership is going to expand because I think we have a serious offer now between selling, leasing and also trading.
So hopefully it's going to get bigger, and I'm just going to do what I can to deliver what I'd like my client to receive. So I'll do.
[00:12:51] John Ramstead: I'm guessing you're going to crush that. Felipe, so great to meet you. Thanks for coming over and look forward to our next conversation.
[00:12:57] Philippe Lubrano: Thank you very much.
[00:12:58] John Ramstead: Okay, thanks.
[00:12:58] Philippe Lubrano: Have a great day. Thank you there.
