New entrants try to cash in on 40% growth

(DENNIS B MALLARI)   

 

 

An increasing number of new players are entering the business aviation sector in the UAE to grab a share of the projected 40 per cent annual growth over the next five years.


The latest name is Dubai-based Airbiz Consultants, which deals in corporate aviation, chartered flights and other related services in the Middle East.

“We realise there is an immense scope in this sector, with 40 per cent to 70 per cent growth recorded in the past two years,” Director Aubert Fernandes told Emirates Business. “The projected growth will be on the back of an increase in demand and the region-wide realisation of the cost-effectiveness of private jet travel and business airlines.”

He said demand would also come from the emerging markets of India and China.

The Middle East, lying between these markets and Europe, would see an unprecedented growth and the region’s expanding corporate sector would add to this.

“With the growing number of companies on the stock exchange and the increasing number of millionaires and billionaires in the UAE and the region, demand for business-only airlines and private jets is bound to rise. And the unavailability of seats in commercial planes during peak times adds to the demand.

“Initially, some companies started flying their own private jets but had their fingers burned. It’s always wise to use the services of professionals. The region is accepting the benefits of business aviation. Time is the most important factor that comes into play. If you’ve come here to sign a $100 million (Dh367m) deal and have used a private jet half the battle is won. You make a statement and have time on your side.

“Growth in Dubai has been massive. Businessmen fly frequently between the emirates and Saudi Arabia but commercial airlines’ schedules make it impossible to fly to Riyadh and back to Dubai on the same day.

“Then there are hotel bills to pay and, of course, we have to factor in the time lost that could have been used productively. With a private jet or a business-only airline businessmen can save time without incurring additional costs.

“The feeder services are also set to grow exponentially. Once people start to live on the offshore development The World, many will take a private jet to the airport rather than getting stuck in long traffic jams.”

Airport congestion and security worries are other areas of concern for business travellers who can avoid such hassles by using private jets. Meanwhile, established players in the sector are improving their services to retain their lead.

Royal Jet, with a 16 per cent market share, is gearing up for a major expansion to service increased demand and counter competition.The company, which operates from Abu Dhabi, intends to increase its fleet from 12 to 20 aircraft in the next five years.
 
Demand may be on the rise but there are certain factors that hamper growth, said Royal Jet’s President and CEO Shane O’Hare.

“The infrastructure for private jet and charter operators needs to be improved,” he said. “We are in talks with Abu Dhabi Airports Company (ADAC) to ensure that business aviation moves well up the agenda on the provision of appropriate infrastructure and we need the correct facilities to service growth,” he said.

 

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