IFG's chairman, Oscar Garcia, is quoted in AERBT after his participation in Quaynote Communications' 3rd annual Future of Business Jets Conference in London
Oscar Garcia's participation in the Quaynote Communications'Conference, celebrated on November 5th in London, was captured by JaneStanbury with an article in the AERBT (An Executive Review of BusinessTravel) website, as follows:
ON TOUR: Supersonic private jets
Aerion SSBJ - Looking for a builder
"Is Mach 1.6 good enough," questioned Oscar Garcia, Chairman of US-basedInterFlight Global speaking about supersonic business jet travel anddefinitely on theme at Quaynote Communications' 3rd annual Future ofBusiness Jets Conference in London last week. The conference highlightedthat private jet clients already enjoy luxury cabins and efficiency with awhole raft of aircraft available for charter, but supersonic speed is theremaining box not yet ticked.
Andrew Hoy, Managing Director, ExecuJet Aircraft Trading, gave an update onthe Aerion Super Sonic Business Jet (SSBJ) which looks set to be first tomarket in 2015 - if a manufacturer confirms it will build it - and here,discussions are progressing, he said. Furthermore, ExecuJet, the salesrepresentative of the aircraft for most of the world (excluding America)confirmed there were already 50 letters of intent from private individuals,along with an undisclosed airline, who have placed MoUs for the $80m 12-seatjet. It may well pick up more sales at the Dubai Airshow next week. DavidMacdonald, Sales Director for Air Partner plc, agreed his clients arealready showing interest in flying on the aircraft. "As experience hasshown," he said, "if manufacturers produce something nice, people will buyit."
Sub-orbital RocketPlane
Aerion interior mock-up
So while the SSBJ may well be a reality, InterFlight Global really isdefinitely futuristic. It is advocating the development of a mutant-stylesub-orbital RocketPlane (using a solid propellant fuel made from acombination of laughing gas and rubber!). The cost of such development - ananticipated $2.5bn. So it seems for the present, a speed of 1.6 Mach, thespeed Aerion is working toward for FAA certification, is enough. (Only inthe US are speeds restricted to below Mach 1). The company also says itsjet will be compliant with Stage 4 regulations and the latest emissionsstandards.
However, for the rest of the business jet community the future seems faraway from supersonic with new regulations, taxes and negative publicityhampering development. Countering the recent negative publicity broughtabout earlier this year by the three top auto executives flying into DC intheir private jets to ask for funding, Brian Humphries Chief Executive ofthe EBAA presented persuasive evidence revealing just how important to aregion's economy business aviation is.
According to a study by Price Waterhouse Coopers, 2007 saw business aviationcontribute $19.2bn to the European economy, both directly and indirectly. Atotal $12bn of this moved through the European heart of Germany, France andthe UK. Corporate activity represents 80% of the business and as Humphries,along with others, argued, business aviation is about productivity,generating commerce and ensuring long term economic growth in a sustainablemanner. It is not about strawberries and champagne. That's reserved forthe 3% leisure users," he said. Air Partner highlighted that its clientbase of leisure users has actually increased from 5% five years ago to 30%today. "These people have made a lifestyle choice switching to private jettravel. The elite and wealthy will be true to it," he said.
ARINC Managing Director EMEA Dave Poltorac highlighted that increasinglybusiness jet clients are coming to them before making a decision on whichjet they buy to ensure they have good inflight communications - anotherimportant aspect in the future of business jet travel, delegates heard.Many clients will want to replicate their office at 31,000 ft. There is anincreasing array of packages/communications channels now available to keepconnected dependent on range and speed of sending messages. Satelliteconnection equipment is getting smaller, faster and less expensive and ifbusiness users want to be able to email and check messages on theirBlackberry, there are a number of options, he added.
"Green shoots, or brown leaves," challenged conference chairman Sean Gatesof Aviation lawyers Gates and Partners as presentations were made indicatingthe beginning of the end of the downturn for business aviation. The year2009 saw the business jet market in a very depressed state with around 18%of the global fleet grounded and for sale, highlighted Embraer's ClaudioCamelier. This has now reduced to 16.9% and in recent months worldwideinventory has declined. On the upside, delegates heard that banks arebeginning to consider financing again, albeit with stricter terms. Whilstthe light jet market movements remain distinctly flat, the mid and heavy jetmovement figures are increasing.
Entry Level Jet
Ben Bewsey of Air Partner
The new Very Light Jet or Entry Level Jet as the OEMs prefer to call it, isaiming to broaden the customer base for corporate aviation offering a lowerentry cost for private jet charter. During the conference Air Partnerannounced it has added the Very Light Jet as one of two new categories onits popular 25-hour prepaid JetCard, becoming the first in the industry todo so. And London-based Oriens Advisors, the newly formed light jetconsulting business, confirmed it is looking to tap emerging markets inCentral Europe and with the recent formation of Central Europe's firstBusiness Aviation Development Association, headed by Dagmar Grossman,expansion is likely there.The new Very Light Jet or Entry Level Jet as the OEMs prefer to call it, isaiming to broaden the customer base for corporate aviation offering a lowerentry cost for private jet charter. During the conference Air Partnerannounced it has added the Very Light Jet as one of two new categories onits popular 25-hour prepaid JetCard, becoming the first in the industry todo so. And London-based Oriens Advisors, the newly formed light jetconsulting business, confirmed it is looking to tap emerging markets inCentral Europe and with the recent formation of Central Europe's firstBusiness Aviation Development Association, headed by Dagmar Grossman,expansion is likely there.
Less optimistically, Andrew Hoy stated "flat is the new growth," discussingthe existing market. He confirmed the view of several speakers that lookingto China, India and other developing markets will ensure long termsustainability for many business aviation companies. In 2005 China had just13 aircraft in its business aviation fleet, yet by the end of 2009 it isanticipated to have 90 and the number will just continue to increaseexponentially with current predictions seeing a fleet of 300 by 2011, hesaid.
The one dark shadow hovering over these developing areas is infrastructure.Andrew Hoy commented "aircraft need love on the ground," and currently thereis a real lack of facilities in both India and China. Peter Edwards of JetAviation expanded on this arguing emerging markets have significantchallenges to face in terms of culture, tax, understanding and developmentof regulatory structures. Both Hoy and Edwards agreed that integratedaviation businesses that work with OEMs and use local knowledge are thosethat will become successful in the emerging markets. Interestingly, the CAAin Singapore attended the conference to learn more about trends in Europe.Emissions Transfer Scheme.
Panellists - l to R David Macdonald, Andy Hoy, Claudio Carmelier, BrianHumphries
These areas will also be challenged, just as the rest of the world is, bycomplicated issues of environmental protection, a subject hotly debated bydelegates and speakers alike. Stephen Boyle from the UK's Department ofTransport commenting on the impending Emissions Transfer Scheme (ETS)controversially stated "it is not a tax." However the business aviationcommunity believes it is, and they argue they are being singled out unfairlybecause they operate in a completely different way to commercial airlines.The ETS may see business jet costs increase by up to £200 per hour of flyingtime. As Sean Gates commented, "If it smells like a tax, walks like a tax,and quacks like a tax, then it probably is one." With the averagebusiness jet in Europe being less than two years old, offering point topoint city pairing poorly served by scheduled airliners, and flying to tasknot to schedule, there are strong arguments to develop a system more akin tobusiness aviation's methods of operation, delegates heard.
"Nothing flies without an airport," stated Bud Slabbaert from St GallenAirport in Switzerland and with increasing congestion at the major airportsthe future for regional airports looks promising. Steve Jones ManagingDirector of Oxford Airport commented "aviation needs regional airports torelieve the congestion," but warned "airports need to think laterally to bea viable long term proposition," citing how Oxford has developed not onlyits airport infrastructure to cater for smaller scheduled flights - anexample being Swiss regional Baboo starting an Oxford - Geneva weeklyservice this winter, but it also operates as a real estate company with over25 other businesses based on the airport site.
Inflite Jet Centre, the Stansted FBO confirmed at the conference a creativeway of seeing that its business jet operators don't lose out on purchasingduty free or luxury goods. In September it ratified a deal with BAA andWorld Duty Free whereby private jet passengers can select their duty freevia the World Duty Free website and collect on their return via Inflite.The deal even extends to Hamleys, the premier toy store. "We've had arocking horse in our terminal and several clients have said they want toorder it for Christmas," said Director Penny Stephens. Inflite regularlycaters for private charters using aircraft up to 200-seats, but as a resultof its unique deal with BAA, crew and passengers flying out on smallerLearjet-sized jets benefit. Inflite is the first FBO to introduce such ascheme. Other FBOs present (namely Assistair and Oxfordjet) said they donot have the passenger volumes for such a scheme, but agreed productplacement and aligning the FBO with a complementary, luxury brand is a goodidea. Omega is one example of a company keen to work with FBOs to expandtheir reach.
Ironically at a conference entitled "The Future of Business Jets" there wasa news announcement from BAE that they have just signed an order for a BAE146-200 to be converted into a VIP 46-seat executive shuttle role from theUK-based Gill Group. "ABJ sales have really taken off in the past 18months," said the company's Stewart Cordner. British companies Design Q andInflite Engineering will provide the design and aircraft modification work,respectively. The typical customer purchasing an Avro BJ conversion isoften a first time owner who eventually will upgrade to a newer jet, Cordnersaid. "Right now the time is great for conversion aircraft, it's the valueproposition of converting airliners to luxury VIP configuration that is socompelling."
For the PDF file, please Click here