Tailwind Capital and Project Phoenix are gearing up to deliver this month their first branded VIP-configured Bombardier CRJ200 regional jets, the Hemisphere 200XR and Phoenix CRJ.
The milestones arrive as these specialist conversion companies are forced to lower the prices of their luxury offerings in response to the tumbling cost of used aircraft and the protracted global economic downturn.
The Hemisphere 200XR has been awarded supplemental type certification for the auxiliary fuel system that, along with the interior, has been developed by US completions specialist PATS Aircraft – provider of the auxiliary fuel tanks for the Bombardier Challenger 850.
“We are planning to hand over the first Hemisphere to Solidair of the Netherlands this month. Had we been able to deliver the aircraft as planned around 12 months ago we would have benefited from the market boom,” says Bryson Monteleone, marketing director for Tailwind Capital. “We hope to have another two aircraft completed by the end of the third quarter,” he adds.
Monteleone attributes the delay to teething problems. “There was an underestimation of the amount of time it would take to complete the aircraft, but now there is a better understanding of the process.”
The Redmond, Washington-based company has five more low-time CRJ200s – purchased from bankrupt commercial carriers Comair and Independence Air by Merrill Lynch, which is now owned by Bank of America. Two of the aircraft are expected to be completed by the end of the third and fourth quarter.
The aircraft have not been sold, but Monteleone is confident buyers can be found despite the tough economic conditions. “These are great aircraft and great value for money. We have had to drop the $19 million price tag [to remain competitive] as the values of both new and used aircraft have fallen significantly over the past year.”
Project Phoenix has also been persuaded to drop the price of its Phoenix CRJ conversion.
“There is a lot more flexibility in pricing today as aircraft are so much cheaper than they were a year ago,” says Mike Cappuccitti, president of the Dubai-based company, which is now selling its branded CRJ for around $18.5 million compared with around $19-20 million for a similar model last year. The first Phoenix CRJ made its maiden flight last month and is being readied for delivery to launch customer Ritz Pacific this month.
“The market has taken a massive knock because of the financial crisis, but now we have a proven concept that people can touch, we expect it will stimulate interest in our product,” says Cappuccitti.
Meanwhile, fellow VIP CRJ200 provider Flying Colours has slashed the price of its ExecLiner to $16-$18 million compared with $18-19 million a year ago. The Peterborough, Ontario-based company, which is also the Phoenix CRJ conversion contractor, has delivered three of the types so far. “The market has slowed,” says sales manaager Eric Gillespie.