Luxury, business jet market to exceed $1.7bln in UAE
When Dhananjay Datar, a Dubai-based spice trader, decided to celebrate the 25th anniversary of his business, he decided to do in style. He took his team members and family up in the sky — in a Boeing Business Jet — to celebrate it 33,000 feet above the sea level. His personal wealth, generated by selling spice, is estimated at $650 million (Dh2.4 billion)!
But he is not the only one. The Gulf is home of a large number of wealthy individuals who use business jets to celebrate moments and to fly out at their convenience with personalised services at their own pace.
Holding business meetings at 31,000 feet above sea level or celebrating birthdays at 900 nautical mile speed was not even in the wildest dream of most citizens and residents of the Gulf in the early 1970s when the erstwhile Trucial States became independent, let alone think of developing their own aircraft.
However, 40 years down the line, these are realities. The wealthy Gulf businessmen are now taking their fast, flamboyant and luxurious lifestyle to the skies — flying in the latest business jets. Those who can’t afford to own them, hire at a rate of $20,000-25,000 per hour. As the regional economies recover from the financial crisis of 2008-09, more and more businessmen are going to avail business jets in the coming years.
By 2020, Mubadala Aviation, is expected to manufacture its own business jet that is expected to serve the market after commercial launch — a move that was nearly ‘unthinkable’ in this part of the world — to benefit from the growth.
Middle East’s business aviation market is expected to reach Dh3.67 billion ($1 billion) by 2018, and by 2020 — the regional fleet size of registered business jets is expected to cross 1,375, according to the Middle East Business Aviation Association (MEBAA).
However, this is going to be elevated to a new level when business jets gets a new home in Jebel Ali — at the Dubai World Central — the 140-square kilometre purpose-built aerotropolis.
“The business aviation sector is growing in the region — leading industry players can now utilise our world-class facilities for business aviation to grow their business,” Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority and Chairman, Dubai Aviation City Corporation, said in a statement.
The government’s vision to establish Dubai as a world-class aviation hub is fast gaining traction. The government is providing strategic support to business aviation companies to enhance their competitiveness, while the dedicated business jet facility at Al Maktoum International Airport is expected to serve as a catalyst for long-term growth.
“We are working on important initiatives to develop a global hub for business aviation, supported by soft and hard infrastructure,” Shaikh Ahmad said.
With nearly 10,000 business jets expected for delivery through 2022, and 30 per cent of buyers planning to purchase additional aircraft in the next five years, the need for strategically located Fixed Base Operators (FBO), Maintenance, Repair & Operations (MRO) will also greatly increase.
The world’s largest economies either directly or indirectly benefit from the rapid growth of business aviation as the industry helps unlock new possibilities that were otherwise unavailable with the limited offerings of general aviation services. A study conducted by NBAA (National Business Aviation Association) in 2012 showed that the business aviation contribution to the US economy reached $150 billion (Dh550 billion).
“Business aviation in the Middle East is going through unprecedented change,” Ali Ahmad al Naqbi, Chairman of MEBAA, said at a conference earlier.
Dubai World Central last year announced it would commence business operations from a dedicated VIP terminal at Al Maktoum International. “But the demand for business aviation must be matched by greater airport access and safety regulations that are specific to our operations,” he said.
That’s perhaps why Jetex, an international flight support provider, is moving operational headquarters to Dubai World Central’s Aviation District. Adel Mardini, President & CEO of Jetex Flight Support, said, “We recognise the importance of the Middle East in our strategic growth plans. Moreover, we expect our new facility in Dubai World Central to be a crucial element in the company’s expansion plans and allow us to support the sustained growth of the market in the coming years.”
XJet is another top-flight company that is geared to establish its business model through its hub in the Middle East. It is planning to build a facility at DWC.
XJet Founder and President Josh Stewart said, “The market holds great opportunities for our company with the increasing number of private jet owners in the Middle East, as several more owners from around the world are interested in the region. We will provide special training to our team to ensure they are able to cater to various cultural sensitivities and work in our new facility.”
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