High-fliers

Volatility in the global markets has increased caution among traditional buyers of business jets such as companies, wealthy individuals and business charter organisations. Sales of such jets will be lower by 15 per cent in 2011 over 2010, says Rob Wilson, President of the Honeywell Business and General Aviation Business Unit of Honeywell Aerospace in its latest report on the market segment, titled Business Aviation Outlook and issued in October at the Business Aviation exhibition in Las Vegas.

In the report, Honeywell Aerospace has determined that between 600 and 650 new business jets will have been delivered until the end of 2011 versus 732 in 2010. In 2012, the number is expected to remain below 700 jets, but will be higher than this year's. From 2012 onwards, growth will return, and until 2021, the accumulated value for business-jet deliveries will reach $230 billion (Dh845 billion), according to Honeywell's forecasts.

"Over the last two years and in most regions, the five-year procurement planning for business jets has been postponed to the period after 2010. This trend is continuing. About 80 per cent of orders are only planned for 2013 or even later," says Wilson.

Growth will mainly be triggered by demand from Asia and the Middle East, while orders from Europe, and to a lesser extent from Latin America, are expected to drop. Investment planning by airliners and charter companies in the Middle East shows signs of confidence despite the not-so-encouraging economic situation on the world markets. It is expected that the market for business jets in the Middle East and Asia will grow significantly stronger in the coming years when compared to North America and Europe.

The portfolio of new premium models in the sector, which are mainly boosting growth, remains strong. "The sales value of jet deliveries did not shrink in the same way as sales numbers, because [of] higher priced jets and sales of wide-bodied business planes compensating the loss in other sectors," says Carl Esposito, Vice-President, Marketing, Strategy and Product Management, bei Honeywell Aerospace, at the Las Vegas show.

Predictions

Altogether, Honeywell predicts a demand for business jets between 2012 and 2016 of around 5,000 new planes, not least because of a range of innovations in the sector.

For example, the market saw the establishment of completely new business jet segments in the last few years, which are new light and medium-weight jets, ultra long-haul jets, super midsize jets and high-speed long-haul jets. This is a result of the change in global demand, the transition from a US-centric to a global customer base, to the fast growth of so-called fractional ownership models, and the establishment of a whole new spectrum of business jet manufacturers.

Technological innovation in the business jet sector includes completely integrated cockpits, synthetic cockpit view, weather radar systems, smart runway and smart landing security solutions, cabin productivity solutions, and new fuel-saving systems for the long-haul segment.

The biggest growth is expected in the super-midsize and large segments, says Manfred Hader, airline expert at German strategy consultant company Roland Berger. The very light jet segment, on the other hand, will see shrinking sales opportunities, he adds. Altogether, the demand for environmentally friendly and silent planes is rising.

Among the major manufacturers of business jets are Boeing, Airbus, Embraer, Bombardier, Dassault, Gulfstream, Cessna, and Sukhoi. The range of smaller jet companies includes Hawker, Grob, Cirrus, Diamond Aircraft, Piper, and others. Even Honda is producing a business jet. Boeing introduced its latest model from the BBJ business jet series at the recent Las Vegas show, of which four have been ordered by Chinese business charter flight company Deer Jet. The plane has 28 seats, one-bedroom suite, a bathroom with shower and is "the ideal solution for company teams," says Boeing's president Steve Taylor.

Airbus recently introduced its 19-seat ACJ319 business jet, claiming that the plane has the widest and tallest cabin of any business jet so far. Total orders for Airbus corporate jets stand at more than 170 aircraft, comprising more than 110 sales of the ACJ318, ACJ319 and ACJ320, plus more than 60 VIP and government wide-body aircraft, the company says.

Gulfstream and Cessna have also added new models as the industry recovers from an order slump at these manufactures that forced output cuts of more than 40 per cent.

Cessna has introduced its $4.2 million Citation M2 and the $14.9 million Citation Latitude. The Citation M2 will seat six, fly faster than competitors and have a range of 2,092 kilometres, the company says. The Latitude has been designed for eight passengers, has a range of 3,218 kilometres and will be on the market in 2015.

Gulfstream expects 10 per cent sales growth as the long-range G650 enters service. The plane is set to complete testing and certification this year. Bombardier is developing the eight- to ten-seat Global 7000 and 8000 jets, with a maximum cruise speed of Mach 0.90 that will enter service in 2016 and 2017.

Brazilian plane manufacturer Embraer says it is developing the Legacy 450 and 500 jets, which will start ground testingin December this year.

Other developments

Russia's Sukhoi, a subsidiary of the country's biggest airplane holding United Aviation Corp, announced earlier this year that is has worked on a business jet version of its Superjet 100, which has a flight range of 6,920 kilometres. It says that two jets have already been sold to Swiss charter flight company Comlux Aviation.

Dassault has repeatedly said that a new super-midsize jet will enter service in 2016, however, the company is not expected to release any details on the aircraft until 2013. Earlier this year Dassault Falcon Jet announced the 2000S, a $25-million variant of the popular twinjet aimed at the super-midsize market.

Learjet will sell its midsize Learjet 85 from next year, and Piper is expected to launch its revised Altaire jet in the near future.

At the Dubai Airshow, Cessna, Hawker Beechcraft, and Diamond will display a choice of their business jets.

No news is expected yet on supersonic business jets, a segment that kept a few manufacturers busy in the last years, among them were Sukhoi and its fellow-Russian plane builder Tupolev, as well as US-based Aerion Corporation, super-fast plane manufacturers HyperMach (UK, France), Supersonic Aerospace International (US), and Next Generation Supersonic Transport (Japan). But the prospects are exciting: HyperMach promises that its supersonic business jet could make the distance from New York to Dubai in two hours and twenty minutes.