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Industry Issues

Business Aviation

12 December 2012

What is BA – Business aviation is essential to tens of thousands of companies of all types and sizes that must compete in a marketplace which demands speed, flexibility, efficiency and productivity. While the organisations that rely on business aviation are varied, they all have one thing in common; the need for fast, flexible, safe, secure and cost-effective access to destinations worldwide. 


It is traditionally defined as a part of general aviation that centers on the business use of airplanes and helicopters. As a subset of general aviation (GA), business aviation is commonly defined as the use of general aviation aircraft for business purposes. The vast majority of business aircraft seat six passengers in a cabin roughly the size of a large SUV and fly average trips of less than 1,000 miles. To facilitate the conduct of business, many of these aircraft are equipped with phones, mobile connectivity and internet access.


In Middle East, business aviation has crossed the takeoff stage and is on a path of rapid climb. Between 2011 and 2030, the Middle East will:


Receive 1,175 business jet deliveries, 410 aircraft between 2011 and 2020, and 765 aircraft between 2021 and 2030. Bombardier Market Forecast 2011-2030


The 2010 fleet of 380 business jets will grow to 1,415 aircraft by 2030 with a fleet growth CAGR of approximately 7% making the Middle East the fastest developing region for business aviation in the world. Bombardier Market Forecast 2011-2030


Globally, delivery of approximately 11,000 new business jets from 2010 through 2020 are expected, generating estimated industry sales forecast in excess of USD 225 billion. National Business Aviation Association


 


Benefits of business aviation – Among many benefits derived from business aviation, the most important is the industry’s ability to save passengers time, thereby increasing their productivity and efficiency, which includes being able to reach multiple destinations with no possibility of delay or cancellation. Business aviation can also be a very powerful tool to advance community service. Humanitarian and relief efforts often focus on the delivery of trained medical personnel and food supplies to disaster areas which can sometimes only be accessible by air using business aircraft.


Business aviation also plays an important role in boosting the country’s economy directly through aircraft manufacturing and airport-related jobs, and indirectly through the purchase of goods and services by firms involved in the manufacture, operation, repair and maintenance of business aircraft.


Myth that business aviation is expensive – We need to understand the aircraft is an essential business tool without which a company would be at a competitive disadvantage in today's globalised economy. Tagging business aviation as an expensive business tool would be unfair. Reason being, in order to determine the value of the business jet over the airline, one needs to understand both the total time needed for the travel and the lost opportunity cost of that travel. The business aircraft will travel on the business traveller’s schedule and thus, offers significant time flexibility. The airlines have set schedules in order to try and fulfil most travellers’ schedules. So we ideally can’t compare the time and cost of both alternatives. Business-hours spent in the office, with a client, or working somewhere quietly without disruption are more productive than business hours spent waiting at the airport. 


Challenges –


The main challenge posing Business Aviation is the presence of the grey market and Middle East is no exception. Illegal flights operating in and out of the airport not only endangers the safety and security of passengers, it also fails to ensure whether the business travellers are flying legally. 


Another enormous challenge is the need for greater infrastructure, airport capacity and airport access for private jets to accommodate the growth in the Business Aviation sector.


Likewise there is a strong need for Business Aviation being specifically regulated rather than having corporate aircrafts fall under the same rules as commercial aviation.


These issues along with others can be tackled through concerted efforts in raising awareness and dialogue with the region’s aviation authorities, governments and all other business aviation stakeholders and most importantly the end customers – BA travellers.


Players – The Business Aviation industry has some key players that help run the industry smoothly and efficiently.


- OEM - An original equipment manufacturer, or OEM, manufactures product or components that are purchased by another company and retailed under that purchasing company's brand name. A few examples of OEM are Boeing, Airbus, Embraer, Cessna, Bombardier and Gulf Stream


- MRO – Maintenance, Repair and Overhaul operations companies retain or restore the aircraft in or to a state in which it can perform its required function efficiently. Eg – Hawker Pacific Avionics, Jet Aviation, Arabian Jets and Al Salam


- FBO – FBO is a fixed base operator and can be defined as a commercial business granted the right by the airport sponsor to operate on an airport and provide aeronautical services such as fueling, hangaring, tie-down and parking, aircraft rental, aircraft maintenance, and flight instruction. In common practice, an FBO is a primary provider of support services to general aviation operators at a public-use airport located on airport leasehold property or adjacent to the airport. Some well-known examples are Execujet, Royal Jet, Presidential Flight, Rizon Jet and Al Jabber.


- Operators – While the airlines specialize in selling transportation by the seat, private jet operators focus on individual private aircraft and itineraries, urgent or time-sensitive cargo, air ambulance and any other form of ad hoc air transportation. These operators offer a large variety of aircraft, such as helicopters, and business jets. Examples – Arab Wings, Comlux ME, Execujet, Gama Aviation, etc.


 


 


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