Exclusive: Dassault eyes business jet opportunities in Saudi Arabia amid China slowdown
French planemaker secured Mideast clients for its new Falcon 6X private jet
Dassault is eyeing growth opportunities for business jet sales in Saudi Arabia and has signed contracts with Middle East customers for its new Falcon 6X private aircraft, a company official said.
The French maker of Falcon executive jets is closely watching for opportunities in African and Asian markets as sales in China slow down amid business uncertainty surrounding its trade war with the US, Carlos Brana, Dassault's senior vice president of civil aircraft, said in an interview in Dubai.
"Saudi Arabia has the will to modernise its economy and that could be a growth potential, depending on how its implemented," Mr Brana said. "Industries are developing and the companies linked to them have a need for transportation to develop their business. When this happens, we're here to answer that need, it creates opportunities for us."
The kingdom has introduced a package of reforms to reduce its economy's reliance on oil, boost private sector activity, attract foreign investments and create jobs.
Dassault this year introduced its new long-range twinjet Falcon 6X private jet that will be able to fly from London to Los Angeles and will enter service in 2022. It competes with the Gulfstream 500 and Bombardier Global 5500.
Dassault has secured customers for the widebody jet, which has a price tag of $47 million, and signed a "certain number" of contracts including with "some" Middle East clients, Mr Brana said, declining to reveal details.
"The response here for the 6X has been very positive," he said. “Lots of customers in the region are interested in large cabins.”
The Middle East contributes 10 to 15 per cent of Dassault's total global sales of executive jets and the jetmaker is aiming to "at least" maintain that level next year depending on oil prices and business confidence, he said.
"Business has been steady, not outstanding but not bad," he said. "A drop in the price of oil is clearly a factor that could have a bad influence."
Dassault has customers in Middle East countries including the UAE, Oman, Saudi Arabia and Egypt.
Brent oil prices, which reached to a high of over $85 a barrel in early October, have since slipped to around $60 a barrel.
Dassault is monitoring signs of economic growth in African markets, where it is upbeat on potential in Egypt and Ethiopia, to seize on opportunities at the right time, he said.
To offset the slowdown in China, the jetmaker is eyeing new Asian markets such as Japan where rules for registering private planes within the country are easing, he said.
The Asia-pacific region contributes about 20 per cent of Dassault's sales and China makes up 10 per cent.
Dassault was "enthusiastic" about Chinese market at the start of the year but the tit-for-tat measures between US president Donald Trump's administration and Beijing have slowed down sales towards the end of the year, he said.
"This has reduced the visibility of people who want to buy private planes and who would postpone their purchase," he said. "We hope this kind of misunderstanding between the US and China will be resolved soon."
The company has an optimistic 2019 outlook for markets in the US and North America and "good expectations" for Europe, Asia-Pacific and the Middle East depending on oil prices, he said."We're convinced that the business jet market has a good future in the medium-term," Mr Brana said.
Updated: December 11, 2018 06:06 PM