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Thu 23 Dec 2010 08:28 AM

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Private jet market eyes Middle East for growth

Region is a key player in growth of private corporate flight, say industry execs

Private jet market eyes Middle East for growth
PRIVATE JET: Top industry executives said that the Middle East would be a key focus as business aviation (Image for illustrative purposes only)

Top
industry executives said that the Middle East would be a key focus as business
aviation makes a comeback after a rocky two years of economic downturn.

“From
a dollars point of view, our focus really is about the Middle East,” Stephen
Taylor, president of Boeing’s business jet operation, told Arabian Business.

Major
companies are starting to focus their energy on the region instead of
traditional powerhouses Europe and the US, both of which continue to slump as
the global recession sees businesses cutting back on frills like the corporate
plane charter in an attempt to save money and appease investors.

“Globally,
Boeing does about $500m annually in business jet sales,” Taylor said. That
number will accelerate with sales of its new, bigger twin-aisle planes, which
will be marketed to the region’s high-flying customers.

“Traditionally
the Middle East has been a third of our business, and [since] the twin aisles
are at a higher price point, the Mid East now becomes our primary region,” he
said.

David
Edwards, managing director of the Gama Group, said that in terms of recovery,
2011 “won’t be the best year. But towards the third quarter, business aviation
will start to pick up and in 2012 we’ll be back to ’07 levels.

“Most
operators saw a 40 percent [fall in their sales] level after November ‘08 – and
in some cases it was a dramatic overnight fall. We’re starting to see a lift
now,” he said.

Stephen
Jones, general manager of Al Bateen Executive Airport in Abu Dhabi, said
business had picked up industry-wide in the last six to nine months.

“We’re
also seeing an organic increase in movements – for the next two years we’ll see
steady growth, though not at the level of five years ago.”

“The
main characteristic of this market is that 10, 15 years ago it was mainly
focused on wire groups and now we’ve seen the market expand to more business
activity – [like for flying] managers and partners,” said Olivier Villa,
Dassault Aviation’s senior vice president for civil aircraft. “The market is
expanding and becoming more rational.”

Held
earlier this month in Dubai, the Middle East Business Aviation forum, or MEBA,
is third largest business aviation show in the world. The last show, in 2008,
saw more than $1.5bn in transactions. This one included two Bombardier
aircraft, sold at $285m each.

MEBA
“shows also how important private aviation has become as a business tool in the
region,” said Alison Weller, managing director of F&E Aerospace, which
oversaw the show and maintains offices in Dubai and London.

“We
are a GCC company on a world stage,” said Patrick Enz, chief executive of
RizonJet, a business charter provider with offices in Qatar, Sharjah and the
United Kingdom.

“Our
business in the Middle East particularly grows in 2011,” Jones said. “With the
[new] twin aisle [planes] it goes up at least by three times if not more.
Traditionally the Middle East has been a third of our business, and [since] the
twin aisles are at a higher price point, the Middle East now becomes our
primary region [for them.]”

He
said the Saudi and UAE markets – “the biggest after the UAE is Saudi” – would
help boost the GCC into a bigger global position.

“The
biggest market historically is the US, and then we’re starting to see fantastic
growth now in places like Brazil, Russia and China. The GCC is an important
place in terms of growth but it still accounts for less than five percent of
the global fleet for us. Its growth will come with business development – and
everything is in place to go.”

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