The burgeoning demand for corporate aircraft is rippling across continents as continued economic growth brings demand from business travellers and a growing breed of very wealthy individuals.

As expected, North America continues to dominate the world's turbine fleet, with the region's total in the past year rising by 20% from 17,447 to 17,816 aircraft. The USA, which accounts for the lion's share of the inventory with 16,990 jets and turboprops - 300 more than last year - continues to see corporate profits and uniquely enjoys high levels of acceptance and flexibility of operation.

Yet the booming economies of Asia, Europe and Latin America are creating a sea change in the sales and distribution of new aircraft. Many airframers are reporting for the first time that orders from international markets have overtaken those from North America. "Business-jet use is spreading globally," says Richard Aboulafia, analyst with US research firm Teal Group. "A key driver behind this is manufacturing firms [and large corporations] setting up facilities in lower-cost areas that lack good transportation links, such as Latin America and Eastern Europe."

Aboulafia's comments are supported by the Flight ACAS database, which shows both regions are providing a hot-bed of activity for the world's airframers.

Rich pickings

Europe is home to the second-largest business aircraft inventory in the world. The census records fleet gains of 293 aircraft over the past 11 months - bringing the tally for the region to 3,058. Here the traditional markets of Germany and the UK continue to provide the richest pickings - with fleet increases of 40 and 45 aircraft respectively - while Portugal, the base for NetJets Europe's thriving fractional and block charter programme, has seen its inventory soar by over 30% to 159 aircraft.

Within this expanding continent the emerging countries of the former eastern bloc are becoming increasingly fertile territory for airframers. "These eastern European countries lack the excellent public transport infrastructure - airlines and trains - that have traditionally hobbled business-jet demand in western Europe," Aboulafia says. Companies setting up in eastern Europe are increasingly looking to private aviation. In 2001, only 10.7% of the global business-jet population was domiciled in Europe. In 2006, Europe's share of the fleet was 13.7%," he adds.

Russia has developed one of the largest appetites for business aviation in Europe. Here fleet numbers have climbed since the last census from 189 to 214 aircraft - including the first Challenger 850. The decision by the Russian government late last month to halve to 10% the import duty on business aircraft, with full abolition expected within six months, will pave the way for further sales of western-built business aircraft.

It remains to be seen if the removal of draconian tax levies will persuade Russian owners to move their aircraft from the less-constrictive national registers of Aruba, Austria and Switzerland, where business-jet inventories have been soaring. For some Russian owners, however, VIP-configured versions of Soviet-era aircraft - Antonov An-74s, Ilyushin Il-76s and Yakovlev Yak-42s for example - still retain an appeal. Other eastern European countries are waking up to the benefits of business aviation, and Bulgaria has seen its turbine fleet rise from nine to 13 aircraft and Romania from five to eight.

Thriving economies

Latin America has the third-largest installed base, with the census revealing a turbine fleet rising from 2,389 to 2,546 aircraft. Mexico continues its lead, according to ACAS, with its corporate-aircraft inventory climbing to 754 in past 11 months. Snapping at its heels is Brazil, home to the largest concentration of turboprops outside North America. Here the fleet increased by 15 aircraft to 679, made up of 310 jets and 369 turboprops. Elsewhere Colombia, Paraguay and Venezuela saw fleet gains of 21, 11 and 62 aircraft respectively, as thriving economies coupled with the need for access to remote areas is driving demand for business aviation.

In Asia and the Pacific Rim growth has been slower, with fleet hikes of 26 and 15 aircraft respectively. As the census shows, most of the growth within Asia is in India where the corporate tally has risen by 26 aircraft to 133 jets and turboprops. Laos, Mongolia and New Caledonia make their census debuts, recording fleets of one, one and three aircraft respectively. Perhaps not surprisingly, Japan has seen its corporate fleet decline by 25 aircraft to 150. This country has refused to embrace business aviation despite attempts by industry to release the shackles of restrictive regulation.

China, by contrast, appears to be waking up to the benefits of business aviation, with fleet numbers nudging upward from 60 to 64 aircraft. Although much work still needs to be done before the cultural, political and economic barriers to market growth can be removed, the government is making progress in improving the infrastructure and regulatory environment in a country where the sales potential from the nascent wealthy middle class is huge.

In the Middle East the fleet has nudged ahead by eight aircraft to 338 jets and turboprops. Saudi Arabia continues to top the inventory with 128 aircraft, although the United Arab Emirates is seeing unprecedented demand for its 54-strong fleet, driven by charter activity.




Source: Flight International