After being dented by the financial crisis, Russian business aviation is back in growth mode. This trend was confirmed by Moscow’s Jet Expo show (September 14 to 16), staged for the first time in the Vnukovo-3 business aviation center of the Russian capital’s Vnukovo Airport. The move from the downtown Crocus City Hall, 20 miles away, allowed for indoor exhibits to be co-located with a busy static display area occupied by 28 fixed-wing aircraft and one helicopter.
Jet Expo 2011 drew 75 exhibitors, which was 22 more than in 2010 but still 16 fewer than the previous high point in 2008. The event, which is supported by the Russian United Business Aviation Association, attracted almost 7,000 visitors.
Significantly, given ongoing controversy over punitive Russian tariffs on imported aircraft, not one Russian-made aircraft was on display. This is despite the fact that Russian airframer Sukhoi is introducing a Sukhoi Business Jet derivative of its Superjet SJ100 airliner. “I think the local companies want to participate, but the fact is that none of the domestic airframers has a competitive product in [the business aviation] market segment,” Jet Expo director Aleksander Evdokimov told AIN.
Bombardier claims to be dominating efforts to fill the market vacuum in Russia and the Commonwealth of Independent States (CIS). Christophe Degoumois, the Canadian manufacturer’s regional vice president, predicted that between 2011 and 2020 Russia and the CIS will receive some 525 business aircraft (plus another 210 in Eastern Europe) and that Bombardier will account for as many as half of these deliveries. For the 2021-2030 time frame, its forecasters see another 1,010 aircraft being delivered. According to Bombardier, the size of the combined Russia/CIS business jet fleet almost quadrupled in recent years, rising from 100 in 2004 to 380 in 2010. Russian fleet statistics are muddied by the fact that the majority of Russian owners still register their aircraft outside the country.
Excluding very lights jets, Bombardier claims to have won a 47-percent share of jets delivered by the end of last year in Russia and the CIS. It estimates that Gulfstream and Dassault each have a 15-percent share, followed by Embraer with 9 percent, Cessna with 8 percent and Hawker Beechcraft with 7 percent. It is little wonder that these manufacturers were so eager to make a strong showing at Jet Expo, given that Moscow is now claimed to have the world’s second largest concentration of billionaires (around 50) after New York City.
According to Degoumois, the legislative landscape for private aviation in Russia is improving, as exemplified by recent liberalization of the country’s sprawling air traffic control system. Long overdue improvements to infrastructure on the ground are also being made, with facilities being upgraded at key southern Russian cities such as Tartartan and Krasnodar.
Gulfstream has attended all six Jet Expo shows held to date, along with its newly appointed president Larry Flynn, who told AIN that the company’s tenacity in Russia has paid off. “We’ve sold a little bit of everything: the G150, G200 and now getting into the G280, and also G450, G550 and G650,” he said. “The larger-cabin airplanes have been a little more popular than the mid-cabin due to the range, and the ability of these airplanes to go from continent to continent.” In late 2013, the first Russian G650 customer will receive his aircraft.
Flynn argued that Gulfstream has had an edge over competitors in terms of its customer support capability in Russia, which is furnished through an alliance with its General Dynamics group sibling Jet Aviation and the maintenance facility at Vnukovo-3 that it established in 2007. The U.S. manufacturer also has a field-service representative in Moscow and parts inventory at Vnukovo.
Embraer Makes Inroads in the Region
But rival Embraer is seeking to close this product-support gap, having announced at Jet Expo plans to extend support arrangements for its Legacy 600 and 650. In a deal signed at the show by Ernest Edwards, president of Embraer’s Executive Jets division, and new Jet Aviation president Daniel Clare, a 24/7 AOG support operation will be established in Moscow for Legacy operators, including spares inventory. This will be operational in December, and both companies will be supporting the effort to train more local mechanics to work on the Embraer aircraft, with the help of FlightSafety International.
Embraer displayed its flagship Lineage 1000 at Jet Expo, along with a Legacy 650 and a Phenom 300. The Brazilian airframer now has 34 aircraft operating for clients in Russian and the CIS.
In August, Embraer delivered the first Phenom 100 to the region, with a Ukrainian client using it for flights to Moscow and other Russian cities. It is scheduled to deliver a second example of the type to the region in October.
After a period of strong bizliner sales in Russia and the CIS, Airbus Corporate Jets has somewhat lowered its expectations for the region. Vice president of worldwide sales Francois Chazelle attributes this shift to the worldwide economic crisis, which has hit Russia harder than some other countries. “Business jets were selling better here in 2008,” he told AIN during Jet Expo, explaining that eight ACJs are operating in the region.
As for his marketing strategy in the region, Chazelle said Airbus will devote more energy toward selling bizliners to corporate and private clients–a marked change from the past focus on government sales. At Jet Expo, Airbus displayed a Comlux ACJ318, an aircraft that is among the 15 ACJs now available for charter flights in Europe.