““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”
"The only reason I got a driver's license was so I could get to the airport," said Robert G. "Bob" Watkins, who has been piloting his own aircraft for 46 years. Today, Watkins is CEO of Coatesville, Pa.-based Global Capital Corp., whose subsidiaries finance, build and service many of the giant aircraft-refueling trucks and portable fuel-hydrant pumping carts seen at commercial airports under the Rampmaster brand.
Watkins' company operates a 1975 Learjet 36 and a 1979 Mitsubishi MU-2. Watkins flies them both, as does his son, Owen, who is Rampmaster's director of engineering. The company also employs four other pilots.
Watkins' passion for aviation began early and by age 15, he was painting houses to pay for flying lessons. He earned his pilot's license at 17.
In 1967, after graduating from Penn State and serving in Vietnam, he joined his father's company, which owned two GMC truck dealerships and operated a driver leasing firm. Watkins soon found a way to grow the business: servicing the mechanically temperamental refueling trucks at major airports. That business quickly expanded to include leasing the trucks and then to designing and building them.
As airports have turned to a system of underground fuel hydrants at passenger gates, Rampmaster has developed hydrant pumping carts. Its latest design runs off batteries that are recharged by a turbine spun as the fuel moves through the cart from the hydrant to the aircraft.
Watkins credits his aircraft with helping him expand the business from its home base near Philadelphia to both coasts of the U.S., Europe, the Middle East, the Pacific and Asia. Today, according to Watkins, Rampmaster delivers 60 million of the 560 million barrels of jet-A aircraft fuel consumed annually in the U.S.
What was your first airplane?
A Mooney Super 21 [single-engine piston aircraft]. We started [our business] with Texaco at Philadelphia International Airport and then at Newark [N.J.] airport. Soon, our operations spread to Boston, Hartford, New York, Detroit, Milwaukee and Atlanta. I would fly in and hire and train the mechanics.
And then you upgraded aircraft?
Yes. In 1971, we got a twin-engine Cessna 310, then moved into the pressurized Model 340. I made the leap into turbines in 1983 when I bought the first MU-2. With the MU-2, I could easily reach west to the Mississippi River and as far south as Dallas. By the 1980s, there wasn't an oil company in the country we weren't working for.
Tell me more about those airport fuel trucks and how you developed that niche.
I was looking for ways to add to the business, particularly the maintenance side. The fuel companies were providing the airlines with fuel trucks as part of their service. They were designed to fit under the wings of the large jetliners of the day. They were maintenance nightmares. The trucks were fully integrated, so if you lost any one component it would sideline the truck. They were built low to the ground, so aspects of maintaining the drive train were very difficult. They commonly sprang leaks because they were so long. So the oil companies were very receptive to farming out maintenance.
How did you go from maintenance to leasing to manufacturing?
When the 1973 Arab oil embargo hit, the oil companies moved quickly to cut costs and that included unloading their airport refueling trucks off on the airlines. They were fairly brutal about it. I saw an opportunity there, found a $10 million credit line and bought 100 of these old refuelers and leased them back to the airlines.
But now the airlines were seeing how much these trucks really cost to maintain, as the oil companies were not picking up the tab anymore. We knew more about these trucks than just about anybody, so it was a natural move for us to design a better mousetrap and build our own trucks. We started building and leasing them in 1981.
What motivated you to sell your first MU-2 and buy a Learjet?
The MU-2 is a great airplane and I used it to move sales and support teams and for family vacations to the Bahamas. But by 1992, I wanted to go after the West Coast market-70 percent of the U.S. population lives on the coasts-so I sold our first MU-2 and bought the Lear 36. The Lear not only opened the West Coast market for us, it allowed us to fly to Paris and meet customers there from places like Saudi Arabia. The Lear 36 is fantastic. I can fly from Philadelphia to Gander [Newfoundland, Canada] and then hit anywhere in Europe.
What have been your most memorable flights in the Lear?
There have been several: Manuas [the Amazon] to Miami; Asuncion to Curacao; Barbados to Corumba, Brazil; Anchorage to Philadelphia; and Gander to Paris to Helsinki. Once we even flew from Philadelphia to Buenos Aires and Rio and back to Philadelphia the same day.
I understand your son has sort of taken over the airplane.
Owen is a tremendously skilled pilot and is living proof of the saying that children do what their parents do to excess. He is out-flying me and out-engineering me and creating better patents than I ever did. Owen and I fly the Lear together when we can, but we both have vital functions at the company and are often headed in different directions, so I bought another MU-2 and kept the Lear.
Tell me about your second MU-2.
The old one was an MU-2P. This one is a 1979 model MU-2-40 Solitaire. It had previously been owned by former Apollo astronaut and Eastern Airlines CEO Frank Borman.
The MU-2's safety record has led some critics to call for its grounding. Are you concerned about this?
Eighty to 90 percent of the MU-2 crashes over the last five years show certain common traits: The pilots had no simulator experience; the airplanes weren't properly maintained; they were flown by some marginal operators; and the pilots committed a major, easily identifiable error just prior to the crash. There are at least a dozen aircraft types in the world crashing at a much higher rate than MU-2s. And that includes some very popular airplanes, such as the Swearingen Metroliner and turbocharged Piper Malibus. The industry has proposed an improved training and maintenance program that is going to address the causes of MU-2 crashes.
So you don't have any reservations about flying the airplane?
Given a choice, for the coldest, darkest, ice-covered, snowstorm-kicking cross-wind night landing, I'll take the MU-2 long after I've left the Lear in the barn.
What would you tell someone thinking of buying an MU-2?
Without great maintenance, older, complex, high-performance aircraft eventually will challenge even the best pilots. If you own an MU-2 and haven't flown it the majority of its life, suspect everything. After we bought ours, we did a logbook inventory of every part ever changed on the airplane. We replaced all the components as recommended by the manufacturer. We changed out the critical flight and engine performance instruments. We had both props overhauled. This plane had only 3,800 hours on it when we bought it and it was considered one of the best on the market, but we spent $100,000 on maintenance to get [it] to the level where I wanted to fly it or put my family in it.
But that is the case with many turbine-powered aircraft.
Yes, it is pay now or pay a whole lot more later and that's a place you don't want to go. There is no such thing as a low-budget turbine [-powered aircraft]. You have to commit the dollars or don't buy this.
You have nine grandchildren. Do you think at least one of them will follow you into the cockpit?
Oh yes. The five-year-old is already saying, "MU-2."
Safety and the MU-2
On Sept. 12, 2006, U.S. Rep. Tom Tancredo (R-Colo.) introduced H.R. 6058, a bill that would ground all MU-2s. At press time, meanwhile, the FAA issued a supplemental notice of proposed rulemaking that would require MU-2 pilots to obtain initial/transition training if they have fewer than 50 hours MU-2 flight time.The previous requirement allowed pilots to have any amount of documented MU-2 flight time in the preceding 24 months.
Tancredo's interest in the aircraft seems at least in part spurred on by the Aug. 4, 2005 crash of an MU-2 flown by an air freight operator on approach to Centennial Airport in Englewood, Colo. Radar and voice data from that accident showed the pilot was flying the instrument approach below the minimum published altitude prior to the crash and had been warned by the control tower that he was flying too low.
Name: Robert G. "Bob" Watkins
Home: East Fallowfield, Pa.
Occupation: CEO, Global Capital Corp.
Education: Graduated from Penn State, 1965. Marketing major.
Aircraft owned: Lear 36, Mitsubishi MU-2
Hours flown: 300 annually, 10,000 total
Personal: Wife Linda, three children, nine grandchildren.