GIVING WINGS TO THE MOTOR CITY
From its roots as a fur trading post to the fourth-largest American city in the mid-20th century, Detroit’s history has had its share of ups and downs. The city was founded in 1701 as Fort Pontchartrain du Detroité by Antoine de la Mothe Cadillac, and the French held it until it lost the area to the British in 1760. The United States captured Detroit in 1796. In 1802, 20 acres of land were chartered as Detroit. The area was incorporated as a city of Michigan territory in 1806 (only to be unincorporated and reincorporated again, for good in 1815. At that time, the city had a population of about 850). In 1827, Detroit chose its (ominous) city motto: Speramus Meliora; Resurget Cineribus (We hope for better days; it shall rise from the ashes).
Detroit began its long history with automobiles on June 4, 1896, when Henry Ford test drove his first automobile on the city’s streets. Ford established his first car company, the Detroit Automobile Company, in 1898 – but the company only produced two cars before failing in 1901. The Henry Ford Co. was founded in 1901, but Ford left his company – which would become the Cadillac Motor Co. – in 1902. He began the Ford Motor Co. in 1903, and its initial investors included John and Horace Dodge, brothers who start manufacturing Dodge cars in 1915. Ford soon moved his company’s operations to the suburb of Dearborn – the company hasn’t actually built a car in Detroit since 1910. General Motors was founded in Flint, Mich., as a holding company for Buick in 1908. Today, it’s the only one of the major U.S. auto manufacturers to actually have its headquarters in Detroit proper.
Walter Chrysler started Chrysler Corp. in 1925. The company is now headquartered in Detroit suburb Auburn Hills. In 1958, Packard Motor Car Co.’s factory (of some 3,500,000-square-feet) closed – the building still stands, and serves as a symbol of the city’s long, slow decline.
Detroit’s other famous export – music – came into play in 1959, when Motown Records was founded by Berry Gordy, with its headquarters in a residential home named “Hitsville USA.” The label’s artists included The Supremes, The Temptations, Marvin Gaye, Stevie Wonder, and The Jackson 5. The label was credited with a role in the racial integration of crossover music, and the label’s name eventually became synonymous with its signature sound: soul music with a pop influence. The label still lives on as part of Capitol Music Group.
The city saw one of the deadliest and most destructive riots in the history of the United States in 1969, when the police raid of an unlicensed, after-hours bar began the Twelfth Street Riot. Michigan Army National Guard and Army airborne infantry were sent in (by Governor George W. Romney and President Lyndon B. Johnson, respectively) to help end the disturbance. When the riot ended, 43 were dead and 1,189 injured, with over 7,200 arrests and over 2,000 buildings destroyed. The 1973 oil embargo sent oil prices climbing – almost quadrupling – as supply dwindled. As the country dealt with gasoline rations and the government encouraged limitations on other power used, foreign cars – most of them smaller and more fuel-efficient than their American counterparts – gained foothold in the auto market.
Detroit’s first black mayor, Coleman Young, was elected in 1974 and served until 1993. Nearing the end of his term, in July 1992, Moody’s cut the city of Detroit’s credit rating to junk status. After Dennis Archer was elected mayor in 1994, the city’s credit rating rose again, only to slide downward under Mayor Kwame Kilpatrick. Kilpatrick would plead guilty to obstruction of justice charges related to assaulting and obstructing a police officer and leave office in 2008.
As the effects of the Great Recession – including rising fuel prices – lead consumers to choose smaller, more fuelefficient foreign cars over gas-guzzling SUVs, auto sales declined. President George W. Bush approved $17.4 billion in emergency bailout funds to General Motors and Chrysler, with Ford securing its own line of credit. In 2009, Chrysler and GM declared bankruptcy. The Obama administration provided financing and guided the companies through expedited bankruptcy proceedings.
In March 2011, the U.S. Census bureau reported that Detroit’s population had taken a 25 percent fall from its 2000 count: down to 713,777. The drop threatened key tax revenue sources: Detroit’s finances were based on a minimum population of 750,000 people. A new law allowing the state to intervene in financially troubled local governments took effect. Dave Bing, Detroit mayor since 2009, warned of a projected cash shortfall of about $150 million by the end of March 2012.
Michigan began a preliminary review of the city’s finances in December 2011, with Michigan Treasurer Andy Dillon announcing later in the month that the state would undertake a formal review of Detroit’s finances. Detroit’s credit ratings were downgraded to junk on March 20, 2012. The review team announced six days later that Detroit was in a severe crisis, but did not recommend an emergency manager. In April, a consent agreement giving the state more oversight while allowing Detroit to avoid a state takeover was approved by the review team and voted in by the Detroit City Council. Mayor Bing warned in June that the city could run out of cash, which led to Detroit’s credit ratings cut further into junk: in July, Bing imposed 10 percent pay cuts on workers. The city and the state went back and forth, with further audits completed, until the review team announced on February 19, 2013 that Detroit was in “operational dysfunction.” Governor Snyder appointed lawyer Kevyn Orr as Detroit’s emergency financial manager, with an annual salary of $275,000, on March 25, 2013.
Orr’s initial report on the city’s finances, released May 13, 2013, called the city “clearly insolvent” and showed a $162 million cash shortfall. By June, Orr said Detroit would stop making payments on some of its $18.5 million in debt, putting the city into technical default. The city’s credit rating was downgraded again – and on July 18, 2013, the city of Detroit filed the largest municipal bankruptcy in U.S. history. Mike Duggan was elected Mayor of Detroit later that year. Detroit exited bankruptcy in December 2014, and since then the city has made efforts to improve services. The auto industry is doing better (on track for a second year of record sales), downtown Detroit is an increase in investment, and the (underpaid) police force even received raises in 2015. Not all see clear skies ahead for the city, as some say not all neighborhoods are experiencing the same boom – but the city’s supporters are investing in its future.
WE OFFER A NEW, FRESH APPROACH THAT MAKES FINANCIAL SENSE – IT’S WORTH TAKING A LOOKJohn Scicluna
John Scicluna, an industry veteran and longtime Detroit-area resident, has joined Jet Linx Detroit as Base President. “I’ve been helping companies and individuals with private jet solutions for nearly the last decade,” he said. Scicluna has experience as an aircraft broker, buying and selling corporate aircraft, so he’s ready to help provide private jet solutions with the signature Jet Linx level of service from Oakland County International Airport.
Scicluna sees Jet Linx as able to fit the Detroit market’s unique private jet needs. “The market has always had a high demand for what I’d call ‘on-demand one-way trips,” Scicluna noted. He described a typical example as someone who lives in Detroit but winters in Florida, flying back and forth at the beginning and end of the season but also flying home for the holidays. “It’s not a typical charter customer,” he continued, “but a perfect fit for our Jet Card program. Typically, our clients like to go to their vacation homes for several weeks at a time, and this solves the dilemma of one-way trips with a round trip and one-way pricing.” Traditional charter services don’t offer one-way pricing, instead charging the client for the second leg of the journey whether or not the aircraft was occupied. “The ability of Jet Linx to leverage our national fleet allows us to offer this pricing for our Jet Card clients. That hasn’t been the case in the market in the past,” Scicluna said.
In addition to personal travelers searching for private jet solutions, Scicluna sees jets as a way for businesses to maximize efficiencies. “I think that Jet Linx will be an excellent option for businesses in the southeast Michigan marketplace,” he explained. “Many businesses with multiple locations will see Jet Linx as an excellent option compared to commercial travel.” Flying directly with Jet Linx allows clients to time their flights more efficiently, as they don’t have to sit around a terminal waiting for a commercial flight – and Jet Linx’s guaranteed availability helps them know that their flight won’t be cancelled at the eleventh hour.
Jet Linx can also access over 5,000 airports in the United States, so clients can often choose to fly to a smaller airport closer to their final destination, reducing ground transportation times, and the reduction in wait times also means it’s easier to visit multiple locations in one day. “Instead of a four-day trip to visit three locations, with travel each day and staying in a different hotel each night, you’re able to visit those locations in one day and then sleep in your own bed,” Scicluna smiled. “It offers a time savings, as well as an increase in your team’s quality of life, when you are able to provide that for your business’s leadership.” Scicluna speaks from experience: having had to frequently utilize commercial options in the past, he sees Jet Linx as the light at the end of the tunnel for business travelers frustrated with the distress that can be caused by commercial travel. “The wear and tear, emotionally and physically, isn’t worth it,” he said.
Scicluna cited upticks in Detroit’s market as reasons why he’s bullish on the area. “The auto industry has come roaring back, and with it the base of automotive suppliers,” he said. In July, the U.S. auto industry was reported to be on pace for a second consecutive year of record sales, and other sectors are seeing improvements locally. Overall, Scicluna predicts that Jet Linx has a bright future in his hometown. “We offer a new, fresh approach that makes financial sense – and it’s worth taking a look,” he said.