Company says charter and fractional ownership business not viable proposition
Plans to start a new Indian charter and fractional ownership company called PrivateAir have been temporarily shelved. Jupiter Aviation, the company's promoter, indicated at the AeroIndia air show in February that it planned to launch operations with five fixed-wing aircraft and two helicopters. But Ravi Narayanan, chief executive of both companies, says that the plan has been suspended due to high taxes on aircraft imports into India.
"The taxes increase the cost of by up to 30% and that's simply not feasible. It's not right that we are charged the same taxes as scheduled airlines. The charter or fractional ownership business is not viable due to the high barriers to entry," says Ravi.
"PrivateAir will not take off as a charter or fractional ownership company for now, though we will continue to monitor the market."
India's impressive economic growth over the last few years has led to growing demand for business jets, but operators of charter, management and fractional ownership companies say that there is a massive shortage of aircraft. High costs, restrictive rules governing the use of airspace and airports, and a shortage of proper infrastructure are also hindering the growth of the business aviation market.
Jupiter could buy two fixed-wing aircraft and two helicopters for its management and other divisions, which include maintenance, repair and overhaul and training. It is in talks with Eurocopter about the EC125 helicopter, and is evaluating business jets such as the Bombardier Challenger 604, the Cessna Sovereign and Dassault Falcon 2000.
The company is also growing its business in other sectors. It is EADS's exclusive partner in India for commercial aircraft maintenance, repair and overhaul and life-cycle support operations. In early May, it signed an agreement with Indian, the state-owned airline, to start an MRO facility for Airbus A320 and ATR aircraft in New Delhi.
EADS and Jupiter could also invest around $100 million in a facility to convert Airbus passenger aircraft into freighters.
Jupiter plans to set up four aviation schools in India, also in collaboration with EADS, with the first to begin operations in October. Riding on the high demand for trained aerospace professionals, it aims initially to train up to 150 pilots and 1,200 aircraft maintenance engineers from India annually.
Source: Flight International
