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Tuesday, 24 November 2009 03:14 UAE time

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Al-Jaber places $1.2bn aircraft order

by This email address is being protected from spam bots, you need Javascript enabled to view it  on Sunday, 16 November 2008
ORDER PLACED: AJA plans to have 21 planes within five years of launching operations. (Getty Images)

Abu Dhabi-based Al-Jaber Group said on Sunday it had placed a $1.2 billion order of aircraft for its VIP charter operations, which will begin flying in February 2009.

The group, which has assets of more than $2.7 billion in sectors including construction, industry and logistics, said Al-Jaber Aviation (AJA) would expand to a fleet of 21 within five years, with aircraft orders from both Airbus and Embraer.

AJA, which will be based out of Abu Dhabi airport, is looking to secure a slice of the region's lucrative VIP charter market, which is worth around $500 billion a year and is expected to grow to $1.2 billion by 2010, Al-Jaber said.

Mark Pierotti, chief operating officer of AJA, told Arabian Business AJA would also operate from Dubai airport and possibly have a presence at the new Dubai World Central airport being built in Jebel Ali.

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AJA will also place airplanes "strategically" around the world in locations such as Moscow and Geneva to serve clients from every continent, Pierotti said, speaking on the sidelines of an exhibition in Dubai.

Pierotti said AJA had paid the deposits on the aircraft ordered, with a syndicate of local and international banks contributing finance for the rest of the orders.

The company will launch with two planes initially, before taking delivery of a new aircraft approximately every three months, he said.

Within five years AJA will be the largest corporate operator of both Airbus and Embraer planes, including eight Embraer Legacy 450/500, five Embraer Lineage 1000, two Embraer Legacy 600, four Airbus Elite and two Airbus Corporate Jetliner, he said.

Pierotti said the company was looking to sell 1,000 hours of aircraft use per year per airplane and was targeting royalty, government leaders, film and music stars, industrialists and corporations.

Pierotti said the difficulties facing the aviation industry due to the economic downturn would not affect AJA’s growth plans.

“The current economic downturn is an advantage to us as fuel prices have come down enormously. We have a niche market which may be untouchable by this sort of thing," he said.

“People who would normally buy their own private jet are not buying it as they don’t want the asset layout and that’s where we come in. We can offer them their own private airspace at a lower rate as they don’t have to buy their own airplane."

Meanwhile, Boeing Business Jets (BBJ), the corporate jets division of the aircraft manufacturer, said of the total 15 orders it had received this year for BBJ and 747-8 VIPS, six of them were from the Middle East.

Prices of the BBJ start from $57 million, with the 747-8s priced at $325 million.

Charles Colburn, marketing director of BBJ, told Arabian Business that since the launch of the unit in 1996 orders in the Middle East have accounted for 33 percent of the 197 aircraft it has sold during that period - the largest of any region - while the region was also the principle hub for 747s used by governments, charters and private individuals.

“Boeing has a huge market share of business aviation in the Middle East, whether it’s the single aisle or the wide body airplanes, so the region is very important to us," he said on the sidelines of the exhibition.

Switzerland-based VistaJet Holding said it planned to aggressively expand in the region following a recent $1.2 billion order for up to 60 new Bombardier jets to be used globally.

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