Over the past six years, Gulfstream Aerospace has enjoyed seven-fold growth in the Russia and CIS market, with the number of its aircraft based in the region rising from 11 in 2007 to 76 as of the end of June this year. According to Trevor Esling, the U.S. manufacturer’s senior vice president for international sales, this year’s first half proved to be the slowest period for Russia and CIS sales since the financial crisis of 2009 briefly unsettled this growth market. But he has high hopes for an uptick in the remainder of this year.
Here at the JetExpo show, Gulfstream is exhibiting its G650, G280 and G450 models. The new G650’s combination of long-range, high-speed and a spacious cabin means that it very much fits the profile for Russian clients. But interest is also growing in its super-midsized G280 sibling and Esling claimed that the new model is now presenting an attractive alternative to the rival Bombardier Challenger 300 and 605 models.
Of the 76 aircraft now based in the region, 53 are in Russia itself and the remaining 23 are in other CIS states, with Esling identifying Kazakhstan and Ukraine as new hot-spots for business jet demand. In Russia, the customer base continues to be dominated by high-net-worth individuals as well as corporations. In reality there is a lot of overlap between these two categories because the individuals are often the primary shareholders at the companies using the aircraft, especially in sectors such as the growing oil and gas industry.
Generally speaking, trading conditions for business aviation firms have improved in Russia in terms of reduced bureaucracy and market restrictions. “There are still some anomalies on tax issues, such as VAT, and efforts are under way to try to make the tax structure more equivalent to that of the European Union,” said Esling. He added that airport infrastructure for business aircraft has improved in Russia, but that this too still needs more attention.
Gulfstream’s main customer support presence in Russia is through the Jet Aviation authorized service center in Moscow. The company has a field service representative in the Russian capital and its field and airborne support teams also are active in Ukraine, as well as in parts of Western Europe that are popular with Russian aircraft owners. The Gulfstream service center at London Luton Airport also is a convenient facility for many Russian customers, not least because many of them have homes in the UK.