Biz jet makers look to build a BRIC mkt

New Delhi: The times may be tough, but not tough enough to stop big spenders. With America’s boardroom brand equity taking a knocking, its reputation in the corporate jet market has also seen a free fall. Result: major aircraft manufacturers such as Boeing, Airbus, Bell, Bombardier, Hawker Beechcraft , Cessna, Dassault, Embraer Gulfstream and Lockheed are looking at the BRIC Block (Brazil, Russia, India, China), Middle East and South East Asia.
The focus, in the business jet, has turned away from trans-Atlantic to Russia, East Europe and India. There are around 80 business jets in India currently. With pending deliveries and new orders, the number is expected to swell to over 300 by 2010. Major purchasers include the Tata Group, Reliance, ADAG, GVK, GMR, Hinduja Group, Jindal and the Ruias.
Most of the orders comprise 6-9 seater business jets in the price band of $10-30 million.
Until recently America boasted around 70% of the total sales in the business jets market. But things have changed dramatically in the past four years. Now, most of the corporate jet makers are taking a keen interest in China and India which have shown the highest potential in terms of the number of billionaires and deep-pocket corporates.
According to Merrill Lynch and Cap Gemini the population of high networth individual (HNI) with financial assets of over a $1 million grew 23% in India and 20.3% in China. The global business jet market is estimated to generate around $300 billion worth of sales in the next decade.
Take Canadian aerospace major, Bombardier, which is looking to sell 12,900 aircraft in the next 20 years. The company will be selling less than half of these in America and around 12 % in the Asia Pacific region.
Historically, markets other than America account for a minority share of the total business jets orders. However the international orders out of US have increased dramatically and now over 55% of business jet orders are from Europe, which is the most important market, followed by Asia. French luxury business jet maker, Dassault Aviation has already bagged a large order from the India. It is also working with Tata Group, GMR and Air Works to set up service centres for its growing fleet.
"....India is one of the major markets and we will be delivering 12-13 of our luxury jets in 2009, including the Falcon 900 Lx capable of flying Mumbai-London non-stop,” Dassault Aviation vice-president (sales & marketing) Alian Aubry said. The market is also changing for the big boys of the aviation mart. Airbus, one of the largest players in the global aviation industry, is also rethinking its US focus.
27/10/08 Chanchal Pal Chauhan/Economic Times

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Categories: Foreign Oct 2008, Indian Aviation- In General Oct 2008, New Oct 2008