Business aviation is booming, with air taxis in the USA and emerging markets in the east bringing a host of new customers to the sector

The weather in Florida comes guaranteed, but the industry’s mood as it gathers at next week’s National Business Aviation Association convention in Orlando will be sunnier than it has been for some years. After the post-9/11 doldrums of 2002 and 2003, stock prices are setting records and the US economy is on overdrive.

With the health of the business aviation sector more or less tied to the fortunes of corporate America, manufacturers, operators and service companies are bullishly ramping up their forecasts. Two weeks ago, Dassault Aviation landed a $1.1 billion order from fractional operator NetJets for 24 of its top-of-the-range 7X business jets. The once-ailing Piper is poised to reveal its own very light jet (VLJ), joining a long list of new entrants to the sector. Next week’s show is certain to see several other big order and programme announcements.

The convention will also be the first at which air taxis and VLJs will be a reality. Years after the potential of a new entry-level jet market was identified and a host of VLJ programmes announced and air-taxi ventures promised, the first two, and highest-profile, aircraft – the Cessna Mustang and Eclipse 500 – have been certificated, and the first VLJ air-taxi operator – Florida’s DayJet – is preparing to take delivery of the first of 239 Eclipses it has on order. Customer flights will begin within weeks. Other would-be air-taxi giants are waiting to roll out their services. Magnum’s models of choice are the Adam A700, certification of which is promised next year, and the Embraer Phenom 100, which will enter service a year later. Linear Air has opted for Eclipses. At least two air-taxi operators are already beginning to build a name for themselves with the Cirrus SR22 piston single.

Even without the hype – the past five years have been like waiting for a stage spectacular that seemed destined never to begin – air taxis are the biggest thing to happen in business and general aviation for decades. The reason is that – as with fractional ownership – they open private flying to a larger market. But because trips are priced in hundreds rather than thousands of dollars, the opportunity is much greater. Essentially, anyone who uses their car or scheduled airlines for their business trips – and in North America they number in the millions – is a potential air-taxi customer.

As our feature in this week’s issue makes clear, however, there are as many business models for operating air taxis as there are start-ups. DayJet’s is the most adventurous: it plans to sell single seats on its Eclipses. Others have gone for a more conventional per-aircraft strategy, reckoning that critical mass and the operating efficiencies and image of VLJs or latest-generation pistons such as the SR22 give them the edge over established charter players. Some have used already-certificated aircraft to establish their networks and name in the market. Others prefer to wait for the breakthrough that VLJs offer.

No-one knows which business model or aircraft has hit on the right formula, but the debate about their relative merits will be one of the most fascinating at NBAA. With each VLJ manufacturer working round the clock simply to ramp up production to meet demand, it could be the end of the decade before things settle down sufficiently to work out who is winning. By that stage, some consolidation is likely as regional operators aspire to establish national networks.

While air taxis are creating a new market for business aviation in the USA, further afield, emerging regions such as India, the Middle East and Russia are hungry for corporate aircraft like never before. Deregulation, soaring oil revenues and an aspiring middle class are all fuelling demand in countries where private aviation scarcely existed a decade ago.

In these regions, the only factor constraining runaway growth is the infrastructure and legal environment. It is vital that manufacturers focus their efforts there not just in pushing aircraft sales, but in helping to fund infrastructure improvements and lobbying for a regulatory regime more friendly to business aviation.

Business aviation is going through a revolution – at once becoming more global and more democratic. In the 1970s, deregulation in the USA and the advent of package holidays in Europe put air travel within the reach of millions of ordinary consumers. So too in the 2000s, VLJs and the burgeoning, more open economies of the Middle East, eastern Europe and Asia are bringing business aviation to – if not the masses – then many more ordinary professional travellers.

Source: Flight International