Boeing Business Jets (BBJ) sales fell by half this year as global economic turmoil hit the executive travel market.
While it is often said in a downturn that the rich stay rich, they may not be travelling in as much comfort if the private jet market is any guide.
The subdued market was reflected in the mood at the Middle East Business Aviation Association (Mebaa) event at Dubai World Central (DWC). “This year has been far tougher than last year,” said David Longbridge, president of Boeing Business Jets. “We have sold 50 per cent of planes that we did last year. I think it has been global factors that have been concerning our owners and operators – Brexit and the election of Trump in the US. For our buyers the oil price is not always the determining factor in the Middle East. I think the industry will bounce back within two years assuming global certainty.”
For plane makers it has been a tough year, but for some charter companies in the UAE such as ExecuJet, the past two years have been difficult.
Charter operators have also felt the impact of the downturn in the market.
ExecuJet runs 18 planes and its services include private aircraft management, charter, maintenance and fixed-base operations in Dubai International Airport and now in the new facility in DWC. It is investing US$40 million in a new facility in Dubai South.
“The last two years have been impacted by the Russian slowdown, the European problems and regional unrest,” said Mike Berry, vice president Middle East of ExecuJet. “There has been little growth in the last two years in fact we are probably below 2014 levels. Because of the price sensitivity of the market the margins are wafer-thin. 2017 will be flat growth but we see positivity for 2018. The market is still immature, so our US$40 million investment shows our belief in the market.”
While many private jet services are under pressure, DC Aviation Al Futtaim is nearly doubling its size and capacity for its VIP terminal in DWC. It runs the only integrated VIP handling and hangar facility in DWC.
“We have not seen any consolidation in our business, only growth,” said Holger Ostheimer, managing director for DC Aviation. “You can drive to our terminal, clear immigration and walk on to your plain in less than 15 minutes. As DXB is moving private jets out of that airport we are picking up some of that business.”
ascott@thenational.ae
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