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Corporate Jets, Their Numbers Cut, Live on At Anheuser-Busch InBev

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Anheuser-Busch Co. ran an impressive fleet of corporate jets.

It owned and operated eight sleek, French-made planes with leather seats and divans and wood interiors. It was as if the St. Louis-based beer company had its own airline – Bud Air shuttling staff to the brewing behemoth’s far-flung operations with regularity. A-B even had its own flight operations department: 20 pilots plus mechanics, line workers and support staff, all housed in a spacious hangar at Spirit of St. Louis Airport in Chesterfield.

Longtime CEO August Busch III, an aviation buff, guided the growth of A-B’s flight operations. Busch III and his sons, including his successor as CEO, August Busch IV, still fly their own planes.

Then, in late 2008, Belgian-Brazilian brewer InBev completed its $52.2 billion takeover of A-B. And those jets seemed certain to be parked on the chopping block. Analysts predicted they would be one of the first things to go. ‘+ts+’/script>’);
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Prior to the merger, InBev says, it never owned corporate jets. It views corporate aviation as a wasteful perk. CEO Carlos Brito, the man who now leads the combined A-B InBev, frequently notes that he and his executives fly coach, opting for business class only on long trips. When Brito came to St. Louis in August 2008, he made a point of telling people it was aboard Southwest.

Nothing seemed to better symbolize the difference between Anheuser-Busch and InBev than those planes.

But a year and two months after A-B InBev was created, the company still has a plane fleet and a flight operations department, although much smaller. Two planes already have been sold. Two more are on the market. But A-B InBev plans to retain two planes and perhaps four pilots, according to several former A-B flight operations employees, who remain plugged into the company’s operations and spoke on the condition that their names were not used. An aviation official confirmed the tally.

That is a shock to analysts such as Trevor Stirling of Sanford Bernstein. Two years ago, the London-based beverage analyst unintentionally helped paint A-B as a weak, bloated company when he published a research note in the midst of InBev’s takeover bid noting the exact size of the company’s air fleet. Investors and the media seized on the image.

Now that A-B InBev appears to be retaining some planes, “it is somewhat surprising,” Stirling said.

The surprise comes because InBev has a reputation for ruthless cost-cutting. Already, more than 1,000 A-B InBev jobs have been lost in the St. Louis area alone. The company announced last week 800 new job cuts in Western Europe. Industry analysts describe the dedication to what InBev calls “running lean” as nearly religious.

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Wednesday, November 22, 7:35 am

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