Netjets lands in India

Private jet firm NetJets is starting operations in India and will look at a partnership in China as it taps fast-growing markets outside its traditional base of the United States and Europe, a senior official said.

NetJets, a unit of billionaire investor Warren Buffett's Berkshire Hathaway, expects strong economic growth and rising incomes in Asia, the Middle East and Latin America will boost demand for private aviation.

NetJets, which sells fractional ownership in private jets to individuals and companies, operates more than 750 aircraft now. "In India, wealth creation is taking place at a phenomenal pace," said John Colucci, executive vice president, at a news conference with local partner Ashish Chordia, who represents luxury brands such as Porsche and Fendi in India. "We think we'll get to our first 100 customers in India very quickly, and that will be just the tip of the iceberg," he said.

There has been a 400 percent increase in the number of NetJets business flights to and from India in the last four years, Colucci said, adding the firm will be targeting high net worth individuals as well as businesses in India. "Our customer base is not affected by a market slowdown... break-even will be a few years down the line here, not many years," Colucci said.

India's total air passenger traffic is forecast to grow at nearly 20 percent annually over the next two years. Discount carriers are expected to grab an increasing share of the market, but demand for private aviation is also growing.

Tata Group's Indian Hotels recently bought a stake in Singapore-based Briley Group's BJETS, which also offers fractional ownership in private jets in India and southeast Asia. The venture has ordered 50 jets worth more than USD$600 million.

Brazilian plane maker Embraer is also eyeing the market for business jets.

Article source: Reuters.

Airport delays - Politics at play ?

Recently India has got two world class airports to completion, the GMR Hyderabad Rajiv Gandhi International Airport (GHIAL) in Hyderabad and the Bengaluru Inernational Airport (BIAL) in Bangalore. Two great examples of efficient project execution that completed on time - something that's not so common in India. They are just waiting for the go ahead from the civil aviation ministry for commencing the commericial operations. All these days we've been badly wanting such facilities and now when the aiports are ready, we don't allow them to operate!! Where else this can happen?

I don't understand why the local papers and the public figures just woke up and requesting for the continuation of the existing airports. What they have been doing all these days? Well.. I agree, the connectivity is an issue. Was it not visible when the project was conceived? No body in India's silicon valley and the other major IT hub thought about the commuter problems then? This is a classic example of the short sightedness of the Indian politicians. I would spare the "leaders" in Bangalore as they were quite busy in staging their political stunts and back stabbing and so on. After all, they were never used to think of a solution until things go out of control completely which is evident on the Bangalore roads. At least the AP government could have done something. On March 15th Soniaji came and threw open the Hyderabad airport with much fan fare and on the same day the aviation ministry has asked GHIAL to postpone the commercial operations for a "few" days, quoting the reason that the airlines need some more time to shift their operations. Is that the ground reality? Similarly the Bangalore airport launch has been postponed until May 10th. I wonder if the high speed express ways and the rail connections can be completed by that time. It is evident that they don't want to trouble the Bangaloreans at least until the elections. After all we citizens have a quite short memory that the politicians are exploiting for decades.

Out of the blues, there is one encouraging (for the airport operators) news from the ministry that the contract would not be breached. I myself won't prefer to travel 2.5 hrs to reach the airport to take a 2 hrs flight. Keeping the city airports open for the short haul flights until the connectivity issues are sorted out is not a bad idea. But the airport operators need to be compensated for the loss of their revenue from all fronts. And more importantly work on a war footage to connect these airports to the people!! Otherwise we'll be inviting a lot of trouble to the success of the Public Private Partnership model.

Private aviation in India on full thrust.

It's no brainer that with the increasing Indian presence in the Forbes billionaires list and a strong growth horizon for the Indian corporate houses, the private aviation services industry in India is all set for a grand take off. While the non scheduled flights and charter services are quite common in the matured economies, India has just started showing some serious interests towards that. Though a chartered flight costs a bit more on the ticket price, for those who realized that time is money, this is nothing compared to what they loose waiting endlessly for the final boarding call, at the transit and at the baggage carousel.

Major aircraft manufacturers cater to these needs in all sizes. Elite business tycoons own larger airplanes like Vijay Mallaya's A319 corporate jet while Mukesh Ambani has recently gifted his wife with an A320 for her last birthday. Well we haven't ordered an A380 for private use yet which is not a big thing in the middle east. A Saudi prince (If I'm not wrong) has ordered the world's biggest airliner for his personal use while he already owns a Boeing 747. I wonder if he has a slightly bigger family.

The majority of these executive jets fall under the 6 to 20 seat segments which is catered by a variety of aircrafts like Embraer, Bombardier, Dassault, Cessna, Hawker etc.,. Currently there are around 180 private jets in India in this category and that is expected to grow to 500 in the next five years. So, it's no surprise that these manufacturers are making a beeline to India. Till now the lack of an MRO (Maintenance, Repair and Overhaul) facility in India for these jets has been a major hindrance for the growth of these jets as the owners have to fly their jets overseas for any maintenance. But the demand should force the manufacturers to do something about this if they want to make the best of their sales. In fact the Hawker Beechcraft Corporation (HBC) has taken the lead and tied up with the InterGlobe to setup a support facility in Delhi for the Hawker Beechcraft air planes.

Other than the individual owners there is a list of players operating charter flights for various clients. Captain Gopinath's Deccan aviation is well known in this field and the luxury hotel chains like Taj and Oberoi group of hotels also have their own fleets to serve the needy clients. While the charter services have been there for some time, the concept of the fractional ownership of the executive jets just picking up. This is quite common in the developed nations and the top investment guru Mr Buffet owns one of these companies. This is quite handy for those who do not want to spend $40 million (or so) to own a jet and more on maintaining them. They can just be a fractional owner by just paying a fraction of the cost to the company that maintains a fleet and have them available for their use at any time. The BJETS, founded by Mr Bala Ramamoorthy has setup shop in India in association with the Tatas provides this model to the Indian customers. While their corporate office will be in Mumbai their flight operations will be out of the new Rajiv Gandhi International airport, Hyderabad and also from Singapore. They've signed the single biggest order ever in Asia for a fleet of 50 brand new jets worth over US$600 million (S$840 million).

Given the good economic prospects these developments just exposes the tip of the iceberg. We'll wait and watch the action.

My First ever Post

Hi readers,

Through these pages I would like to share my passion on the airplanes and the air travel and pretty much anything around those magnificent flying objects. Trust me, this is my first ever post. Thirty minutes back I was googling for how to start a blog and here I'm. As I'm from India, my topics would be mostly orbiting around that. Anyways, I would try and cover all the other major happenings in the sky. Please do visit me regularly and share the thoughts.

Arun Kathirvelu