Plush bizjets no more. Smaller craft fine

With liquidity sapped out of the market, businessmen and high networth individual (HNIs) are no longer queuing up to order super luxurious business jets, but the market for the stripped down versions, such as the Falcon 7X, is still robust in India.

Take the case of Seattle-based aerospace company Boeing Co’s sale of corporate jets in India till now. The aircraft maker has delivered only three 737-based Boeing Business Jets (BBJ) in India.

Dinesh A Keskar president of Boeing says that even though India’s GDP growth is better than western economies, networth of individuals has been negatively impacted due to a meltdown in the stock market and this was pulling down the demand for corporate jets.
“There is not just enough liquidity for plush bizjets like we offer. The current economic condition has affected the demand negatively. Though, once the market revives, we will see demand pick up again,” said Keskar.

Though, the trend in the smaller business jets is a little better.  Dassault Falcon, which is displaying its bizjet Falcon7X at Aero India 2009, will be delivering six of the same aircraft in the next three months.

The orders for these business jets were placed in the middle of last year from customers in Mumbai, Delhi, Bangalore, Hyderabad and Pune. The average price for these business jets is around Rs 250 crore ($50 million).

“The Indian market for business jets has been rapidly expanding, especially in the last three years due to a very strong economy,” said John Rosanvallon, president and CEO of Dassault Falcon.

Falcon’s sale for 2008 was strong despite the global economic downturn, which began to impact only in the fourth quarter. Its order book at the end of the year was 500 aircraft, of which half is for the Falcon 7X.

Looking at the growing base of its business jet in India, the company has opened a spare parts distribution centre in Mumbai, which is being managed by DHL. The company is also evaluating setting service centres in India. Currently, Dassault Falcon’s aircraft are being serviced at authorised service centres in Dubai and Singapore.

US aerospace company Honeywell International Inc has forecast the global business jet deliveries in 2009 to hit 1,200, up 15% from 1,020 last year.