THE YEAR THAT WAS/ Now Small & medium cos fly the biz jets

Internationally, biz jet sales are soaring. After decades of slow growth, this year has seen several Indian businesses going for the top of the line aircraft like Bombardier’s Global XRS and other large business jets.
Unlike the commercial aircraft market, which is split between just two players, the business jet market has a lot more competition. The biggest players in this market are Bombardier, Cessna, Gulfstream and Raytheon. Other players with a significant presence are France-based Dassault with its Falcon aircraft and regional jet manufacturer Embraer.
In India, corporate jets were earlier used by large business houses like the Tatas, Birlas and Reliance, who operated the aircraft and helicopters largely to ferry the brass to the remote sites where the factories were located. The primary change now is that small- and medium-sized companies are joining the club, there is also a bias towards larger, faster jets with intercontinental range. The change is partly a result of strong financial results and partly a requirement made necessary by growth - financial as well as geographical, say industry sources.
Some companies that earlier chartered planes from others have now gradually decided it makes sense to acquire their own planes. New bizjet owners include the likes of GMR Group, Punj Lloyd, Hindustan Construction and Jaiprakash Associates.
“The efficient use of business jets depends a lot on the extent of utilisation of the planes,” says PK Ratta, vice-president Raymond Aviation. The Singhania group company has been in the business of chartering aircraft for the past decade and has a fleet of three helicopters and two business jets, an HS-125 and the latest - a Challenger CL 604. The aircraft are used by the company’s top management as well as chartered out. The Challenger, for example, is being hired for Rs 3.15 lakh per hour.
Aircraft operations have a high fixed cost in the form of salaries, insurance and regular maintenance costs, says Mr Ratta. Bizjet owners often pay the same salaries to pilots and engineers as the large airlines. The cost to company for an experienced pilot is now about Rs 50 lakh per annum, and the commanders are difficult to find even at these salaries, say company sources. The other major business group chartering planes are the Tatas, which have two Falcon 2000s available for chartered flights.
A look at the itineries of the CEOs using business jets shows a huge flexibility that a personal plane can give the top management.
Citing an example of the flexibility, Gautam Singhania of the Raymond group says, his company has joint ventures in several parts of the world and connections offered by commercial airlines are often not convenient.
At the very top end, some corporates like Kingfisher and Reliance are going in for large business aircraft, that are actually commercial planes configured for business use.
Amit Bhandari & Cuckoo Paul/Economic times

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