MEBAA Convention News

Alnaqbi Optimistic Despite Regional Setbacks

 - December 6, 2018, 4:00 AM
MEBAA founding and executive chairman Ali Alnaqbi is dedicated to promoting business aviation in the Middle East. He believes it’s critical to develop the right business plan.

Despite a nearly year-long anti-corruption drive imposed by the Saudi government, and a boycott imposed on Qatar in 2017 that imperiled the future of the Gulf Cooperation Council, the adverse effects on the region have not dented the optimism of the Middle East Business Aviation Association (MEBAA). Members and leaders agree that the countries involved can put these problems behind them.

Ali Alnaqbi, MEBAA’s founding and executive chairman, told a press event in Dubai in late October as he looked forward to the show, “The market has been very healthy, despite all the challenges we face. In our area, a couple of countries had issues, but, if you put that aside, and you look at the [potential], we have had good growth. We are doing well [despite] the issues that are being faced in the region. 

“The MEBAA Show is part of the international calendar now. We have expanded the show and growth [in recent years] has been very steady. Oil prices have had a direct effect on aircraft operations, of course. There is going to be an impact, and those on very low margins will not survive. Those who have got [their pricing] right will… find [a] way out of the [problems posed by] increasing oil prices,” he said.

“Our industry is very healthy. It is welcoming new players. The environment has influenced [conditions adversely], but you have to know how to maneuver [into the right spot]. I love challenges. They make you strong. The environment influences any industry you enter into. We are [trying to achieve] sustainability here. You work in an environment where there is a lot of competition.”

Alnaqbi is happy with the progress of the FBO build-out at Al Maktoum International Airport (DWC), and the fact that five players are now in operation. He said a drawback with the VIP Terminal at DWC was that the common-user facility made it difficult to obtain the kind of privacy that some Middle Eastern travelers required.

Alnaqbi praised the role of the UAE’s General Civil Aviation Authority (GCAA) in speeding up licensing procedures. “You can get things done much more quickly now. To get an Aircraft Operator’s Certificate (AOC) [in the UAE] used to take two years. Now, we are talking about [as little as] four, or even three, months. The environment is healthy and we see the growth to encourage others to come in and [start] their businesses here,” he said.

Alnaqbi dwelled at length on the problems caused by the illicit gray charter market in the region. “For example, in Saudi Arabia, what did they do? GACA canceled charter on (FAR) Part 91, or privately registered aircraft. All the aircraft in Saudi are now commercially registered. This is a step in the right direction. Saudi Arabia follows the FAA rules and regulations. They have canceled [Part 91] in an effort to reduce the gray market.”

He went on to say that foreign companies operating in the region had to observe the correct protocols. “We are foreign [when we operate into] Europe. When [our companies] go to Europe, we follow the procedures exactly. When European operators come here, they must also follow the rules. If you want to base an aircraft here, you are most welcome. Register the aircraft. We welcome foreign operators, but there is a legal way [of doing this]. We have a good percentage of illegal flights in the region.”

MEBAA was founded in 2006 and Alnaqbi has acted as a representative for the Middle East business-aviation industry ever since, leaving his role with the Presidential Flight in Abu Dhabi to go full time at MEBAA in 2015. He also represents the Middle East as vice-chairman of the International Business Aviation Council. He estimates the total size of the regional fleet at 540 aircraft.

He thinks that sales may start to pick up in the near future. “I think there will be a lot of deals at this show. But deals don’t get publicized, due to the nature of our business. We didn’t hear anything on deals in Orlando at NBAA. [But] people are buying—both individual and corporate.”

He said that preowned aircraft are not the factor in the region that they are in Europe. “In our part of the world, the secondhand market is not as popular... Here, you see companies launching with products that are new. The size of aircraft found in the preowned market is the wrong size for [Middle East] requirements,” he said.

“In MENA, we have 70 percent of the widebody aircraft worldwide based here. So we have more widebodies than midsize or narrow [aircraft]. Many of the secondhand aircraft are not suitable for the large companies. Here, they don’t represent a good percentage. Most of the aircraft ordered here are new.”

On Qatar, Alnaqbi said that the authorities there had stymied his attempt to organize conferences in Doha in the years prior to a boycott imposed in June 2017. Since then, flights between the UAE and Qatar have ceased. “We used to have a number of technical stops, but that doesn’t happen anymore. Yes, we had Qatari aircraft coming to the UAE [earlier]. Now, they are not coming anymore. It is as simple as that.”

Alnaqbi said the demise of Abu Dhabi’s single-engine turboprop charter operator, GI Aviation, at the end of October, had been a blow to efforts to see the introduction of a workable small-size charter operator.

“I said at the time: this market needs the services of a small aircraft, whether a turboprop or very light jet. But you cannot operate one or two aircraft and… make money. You have to start with the right number. Otherwise, you will close down, because it will become a very expensive operation. They started with one. How can people charter? By the time they added another, it was too late. My advice to whoever wants to start [this kind of operation] is that you have to start with the right number,” he said.

“The pricing was way too high. I would [charter] a Hawker, with two jet engines [instead]. You have to position yourself [correctly] to be a player. I told them: “You have to buy [a dozen] aircraft. A taxi service has 300 vehicles. You have to have aircraft in every major city. I am very sorry to see them go. It is unfortunate.”

Asked to assess the relative merits of the Gulfstream G650 and Bombardier Global 7500, Alnaqbi said both were impressive. “It is very hard to distinguish between them. Everyone has a favorite. I think the 7500 is a very good aircraft. We will see how it is accepted here. What do you need it for? Are you going to MENA only, Europe, or the U.S.? How many times [a year]? [You have to decide what] is best for your company. I love them both. Aircraft are becoming very similar. The choice has become harder.”