EBACE Report

 - July 3, 2007, 6:42 AM

The European Business Aviation Convention & Exhibition (EBACE) is growing stronger. At the show’s inception in 2001 there might have been some who doubted the viability of an annual European business aviation show along the lines of the firmly established NBAA event in the U.S., but the 2007 edition, held May 22 through 24 in Geneva, weighed in as the biggest and best so far in the show’s seven-year history.

With a record-breaking 11,000 visitors and 354 exhibitors (up a healthy 18 percent from last year), the event faced a sold-out Hall 6 at the Palexpo Convention Center, forcing organizers to relocate many high-end airframe exhibitors with large display booths to Hall 7, adjacent to the static display. The 61 aircraft on display were a testament to the fact that Europe’s signature business aviation event–and the overseas market–is thriving. Indeed, the show promises to become even more cosmopolitan than its American cousin, with many U.S. exhibitors realizing that as the global business aviation market expands, they could reach a wider international audience at EBACE. Drawing visitors and exhibitors from Western and Eastern Europe, the Middle East and even Asia, the show is climbing in clear skies and is scheduled to take place in Geneva through 2012.

Manufacturers Log Big Sales
Emblematic of this growth are the sales deals announced on the EBACE stage. NetJets Europe on the first day of the show inked a deal worth more than $700 million with Hawker Beechcraft for 32 Hawker 4000 super-midsize business jets and their maintenance. The fractional operator said its European customers had been clamoring for an entry-level stand-up cabin aircraft, and the 4000, which received its type certification last November, fit the bill. The deal is in addition to the fifty 4000s already on order for NetJets’ U.S. operations. Deliveries will begin next year and continue through 2016. The Wichita-based manufacturer tacked on another $30 million sale in the form of a pair of Hawker 900XPs to Spain’s Gestair Private Aviation, which will use them for European operations.

Continuing the momentum, Gulfstream netted a firm contract for three G450s from Saudi Arabia’s National Air Service. If the operator exercises options it took on 17 more, the agreement could be worth a potential $650 million. Deliveries will begin in the third quarter of 2009. NAS CEO Taher Agueel says the deal is crucial to the future plans of his company, Saudi Arabia’s only licensed private aircraft operator. Gulfstream went on to add another G450 sale to UK charter operator London Executive Aviation. When that aircraft is delivered in 2009, it will be the first G450 on the UK charter market. 

Another major transaction saw Cessna closing a deal worth $280 million with Austria-based JetAlliance. The  purchase includes one CJ1+, six CJ2+s, five CJ3s, three XLS+s, one Sovereign, two Citation Xs and seven Citation Mustangs. According to JetAlliance CEO Lukas Lichtner-Hoyer, some of the aircraft will be used by Austrian Business Jet, a new partnership venture between his company and Austrian Airlines that will carry business jet passengers from Eastern Europe to Vienna to meet scheduled long-haul commercial flights.

Grob raked in orders for its SPn light jet. The company announced at EBACE that it holds firm orders for its first two years of production–amounting to more than 60 aircraft. The Swiss-German airframer broke through to the Middle Eastern market at EBACE, with orders from two Abu Dhabi-based operators. The four SPns destined for Falcon Aviation Services will be split between six-seat executive layout and 10-seat configuration suitable for conversion as air ambulances, while newly formed Prestige Jet–part of the Al Yasi group–plans to use a pair of SPns for VIP service as well as shuttle operations to the group’s steel factory in Oman.

While the brisk sales pace, coupled with the length of the OEM backlogs, reflects the current vitality of the business aviation market, the absence of significant new aircraft launch announcements at EBACE could be seen as a sign of caution among airframers. One sight on the show floor that did raise eyebrows was Cessna’s mock-up of its large-cabin business jet concept. The design, which is expected to accommodate nine passengers, has yet to be defined in terms of interior arrangements, avionics or engines, but according to company chairman, president and CEO Jack Pelton, a firm decision on the future of the program could come by the end of the year.

The very light jet category is creating as much buzz in Europe and around the world as it has in the U.S. The much anticipated Eclipse 500 made its second European showing this year at EBACE (its debut was at the Aero 2007 show in Friedrichshafen).

With type certificate and production certification finally in hand, Eclipse announced a 180-aircraft order–the company’s largest European order to date– from Etirc, a start-up Turkish air-taxi operation to be headquartered in Istanbul. The order includes firm sales of 120 aircraft and options on 60 more, and deliveries are expected to begin in the middle of next year. According to Etirc, the order will satisfy “an explosion” of demand in Eastern Europe. The air-taxi fleet will service Turkey, the Turkish Republics and European destinations within the 500’s range of 1,125 nm. Eclipse is now claiming orders for 2,600 copies of the new VLJ and plans to deliver 1,000 of them next year.

The Albuquerque, N.M.-based manufacturer cemented its training team at EBACE with Flight Simulation of The Netherlands and Texas-based Higher Power Aviation to provide an FAA-approved training curriculum for the Eclipse 500.

Another nascent VLJ racked up a major deal as Hainan Zhong Hong Tai General Aviation Airlines of China signed for 50 Adam Aircraft A700s. The sale takes Adam’s order backlog to 377 aircraft. Hainan Zhong Hong Tai General Aviation Airlines plans to sell the A500 and A700 for Adam Aircraft and provide leaseback options to owners for air-taxi operations, following delivery of the A700 next year. Adam hopes to achieve FAA certification for its first jet by the end of the year, with EASA certification to follow soon after.

Cessna has already achieved that milestone, making its Mustang the first VLJ to be certified on both sides of the Atlantic. One-third of the 300 Mustangs on order are destined for Europe, and deliveries are expected to begin this summer.

The Mustang and Eclipse 500 are the two aircraft under consideration by ByJets, a new Geneva-based start-up air taxi/ corporate shuttle service. The company says it will acquire a dozen VLJs next year and intends to add another dozen each year. Since both airframers have large backlogs, ByJets plans to acquire early delivery slots from position holders.

Brazilian manufacturer Embraer announced sales of 11 more Phenom 100s at EBACE. Seven of the aircraft–which is on track for certification next year–are on order by Kansas City, Mo., fractional operator Executive AirShare. Premier Aviation, based in County Kildare, Ireland, signed a contract for the remaining four. Premier plans to use the jets in its fractional share and charter operations. 

Large-scale Luxury
At the other extreme of the business aviation evolutionary scale, the large-cabin airliner-class jets saw action at EBACE as well. At the start of the show, Boeing announced that it had received orders for seven aircraft since the beginning of the year. Worth nearly $500 million, the orders are for six BBJs and one executive version of the 787-9 Dreamliner.

Before the show ended, Boeing had added two more to that total. European private charter operator Ocean Sky Aviation bought a BBJ, while Hong Kong real-estate tycoon Joseph Lau added an order for another executive Dreamliner. The company also expanded on its plans for an executive version of its 747-8, which has 5,667 sq ft of floor space and travels at speeds up to Mach 0.86. The aircraft would be capable of nonstop flights linking city pairs such as Dubai and Los Angeles. Since last year’s event, Boeing Business Jets has taken orders for 27 aircraft, including 12 BBJs, two BBJ2s, three BBJ3s, six 787 Dreamliners and four 747-8s. According to Boeing, 44 percent of its non-commercial jet sales are to private individuals.

Cross-Atlantic rival Airbus was represented at EBACE by the airshow debut of the newest and smallest member of the consortium’s ACJ line, the A318 Elite. This aircraft, the first of five Elites ordered by launch customer Zurich-based charter operator Comlux, features an interior by Lufthansa Technik, designed for 18 passengers. Airbus has more than 20 A318s on order, and since entering the corporate jet market in 1997 has sold 80 from its ACJ stable. U.S. launch customer Minnesota-based Petters Group Worldwide is expecting delivery of the first of six Elites on order next year and expects to take advantage of the Elite’s 3,400-nm range for nonstop transcontinental and transatlantic routes.

To meet the surging demand for its executive jets, Airbus announced the appointment of two additional completion centers in addition to Lufthansa Technik and Jet Aviation in Basel. The airframer has tapped Stork Fokker in The Netherlands and revived its own defunct completions facility located at Airbus’s premises in Toulouse, France, to perform interior completions. The new independently managed company, majority owned by Airbus, will provide the flexibility needed in the executive bizliner market. Initial plans call for the completion of three executive Airbuses at the facility per year.

Jet Aviation has also unveiled plans for a $35 million investment program at its Basel, Switzerland completions facility. The program calls for increasing ramp space and constructing a hangar large enough to accommodate an Airbus A380 and Boeing 787 simultaneously. The expansion will more than double its existing 248,000 sq ft of covered space and by next year will increase the completion shop’s annual capacity to 20 Dassault Falcons and six airliners. The company just completed and delivered its second executive 747-400 for the Dubai Air Wing, completing a contract it was awarded in 2004.

Dealing the Cards
The jet card concept seems to have established itself firmly in Europe. Geneva-based PrivatAir announced it has taken $10 million in deposits for its Select jet card. According to chief executive Greg Thomas, “We believe it’s the perfect product for Europe, and we think the rest of this year will show some interesting developments in that field. We have been through two renewal cycles without spending any money on marketing and we’ve used it as a pilot program to understand how to manage deadheads and other issues.” PrivatAir’s fleet ranges from turboprops to Boeing BBJs.

Belgium-based Flying Group began offering its FlyingCard option in January and has seen such success that the company now considers it one of its core services along with aircraft management, fractional ownership and ad hoc charter services. Flying Group says its program is tailored to the needs of customers flying up to 100 hours per year and is based on a fixed payment of $186,000 for 20 flight hours in a Cessna Citation Excel. Clients can move up or down within the company’s fleet on a pro rata basis. The company operates a mix of Citations (I, Bravo, Excel and X) and Falcons (900C, 900DX and 900EX EASy). It is scheduled to take delivery of three Falcon 7Xs next year.

Also this year, French executive helicopter charter operator Aviaxess unveiled its new Avia-card, which claims to be the first frequent-flier loyalty reward program in the business aviation market. According to company officials, after logging specified numbers of flight hours, clients can earn rewards ranging from complimentary hotel accommodations to Breitling watches. Customers accrue flight hours either by chartering the company’s own fleet of helicopters or by booking fixed-wing charters through Aviaxess’s brokering division. The program is in addition to the company’s Corporate Helicard, which was introduced last year and allows clients to purchase discounted block charter rates for helicopter flights.

Air Partner is reporting a surge in business. Over a period of six months ending in January, the UK-based company saw its client base increase by 25 percent. Compared with the same period last year, sales grew by 60 percent while operating profit increased by 139 percent to $6.3 million. The company recently rebranded itself into two business units, including Air Partner Private Jets, which handles its new Jet Card division.

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