GRAHAM WARWICK / WASHINGTON DC & JUSTIN WASTNAGE / LONDON
The deal will have sales benefits for Airbus and financial benefits for Avolar parent United
United Airlines' fractional-ownership subsidiary Avolar is to market the Airbus Corporate Jet (ACJ) in North America. The deal with Airbus is structured so that Avolar will never own the aircraft, but will operate them on behalf of customers using mainline United pilots, with maintenance provided by the airline's United Services division.
The agreement covers up to 15 aircraft, and is not linked to Airbus delivery deferrals announced by United after the 11 September terrorist attacks. Customers will be able to buy a whole ACJ or share ownership, with Avolar operating the aircraft under US Part 121 regulations. Airbus will continue to sell the A319-based ACJ directly to North American customers, who will be able to contract with Avolar for management of the aircraft.
The agreement meets Avolar's need to offer a large-cabin aircraft and Airbus' desire to increase sales of the ACJ, which lag significantly behind those of the Boeing Business Jet. The deal's structure avoids increasing United's commitments at a time when it is financially crippled, as Avolar has said it will not fund the venture beyond its initial investment.
Avolar is marketing the ACJs, to be completed in basic corporate shuttle configuration, to sports teams and companies running frequent flights between multiple locations. Boeing Business Jets president Lee Monson says that while the Airbus product is becoming a stronger competitor, Avolar is "addressing a different market".
United is in talks on selling a majority interest in Avolar to private investors who would take over all future funding obligations, including the bulk of the venture's orders and options for 244 Dassault and Gulfstream business jets. Avolar says it is still on track to begin full operations in April next year. Interim operations for initial share owners are due to begin shortly, using two company-owned Dassault Falcon 50EXs.
Avolar is continuing talks with manufacturers on placing orders for light business jets to complete its line-up of fractional-ownership offerings. Deals signed so far cover the mid-size Falcon 50EX, super mid-size Gulfstream 200, large Falcon 2000/2000EX and Gulfstream IV-SP and long-range GV/ GV-SP. The first aircraft on order, a GIV-SP, will be delivered next April.
Source: Flight International
