Despite Hawker Beechcraft announcement earlier this month that it is to lay off 5 percent of its workforce in the face of the global economic slowdown, executives with the U.S. manufacturer here at the MEBA show say the Middle East remains one of the few remaining bright spots for airplane sales. This is why it recently opened a new sales office in Dubai.
Hawker Beechcraft is slashing around 490 jobs from its workforce of about 9,780 worldwide as part of a cost-cutting initiative, the centerpiece of which is planned production slowdown. The news comes as the U.S. business jet maker announces inroads in the Middle East market, particularly with wealthy individuals who are increasingly viewing the company’s Hawker twinjets and King Air turboprops as economical alternatives to models from other manufacturers.
“The economic crisis could actually end up helping us in the Middle East since some buyers who might have been considering a [Gulfstream] G450 will now look more closely at the Hawker 900,” said Sean McGeough, Hawker Beechcraft vice president for international sales. “Ours is a $15 million airplane that can fly nonstop to London versus one that costs $30 million.”
Conceding that deteriorating real estate values and the declining price of oil could put the brakes on spending in this part of the world as well, McGeough pointed to sales of special-mission airplanes and recent inroads with buyers who have traditionally favored heavy-iron airplanes as reasons for continued optimism about the Middle East market.
Saudi Arabia, Dubai and Abu Dhabi have been the strongest areas for Hawker Beechcraft sales, McGeough said, noting there are currently around 30 Hawkers based in the region. The last three or four years have been good ones for the company in the Middle East, and the last six months has seen sales of King Air 350s to individuals marking a new trend for the region. “Five years ago we would never have thought we would sell three new King Airs in such a short span of time to private individuals here,” McGeough said.
Saudi Arabia’s National Air Service recently took delivery of the first two Hawker 750s it ordered as part of a deal for 25 airplanes to be built and delivered between now and 2011. Hawker Beechcraft is expected to announce another large deal with an undisclosed customer here in Dubai today.
As the company expands its presence in the region, it has also boosted its maintenance and training capabilities. Jet Aviation’s Dubai base serves as Hawker Beechcraft’s authorized Middle East service center for the Hawker 800 series jets and the new 750 and 900XP models, and the company has an exclusive training agreement in place with FlightSafety International.
Here this week Hawker Beechcraft has a chalet (No. 36) next to the flight line and is showing off a new Hawker 4000 owned by a U.S. customer, a Hawker 900 owned by a Dubai customer and a Premier I, Hawker 400XP and King Air 350.
In other recent news from this region, Dubai-based MAF is set to take delivery of its new Hawker 900XP by the end of this year. Hawker Beechcraft has just delivered the first and second Beechcraft King Air 350 twin turboprops to Saudi Medevac, which is to receive three more by the end of 2008, and charter operator Gulf Jet is also due to receive one of these aircraft over the next few weeks.