Royal Jet CEO calls for airline-style global alliances for private aviation sector

 

The Royal Jet CEO emphasised the private jet market should closely look at the development of global alliances among operators, along similar lines to those in the commercial airline sector. He said that regional growth in private jet travel would need to be supported by more high-quality Fixed Base Operation and maintenance, repair and overhaul facilities.

Speaking at a panel titled ‘Cooperation and joint industry collaboration between commercial airlines and business aviation’, O’Hare explained how commercial airlines and private jet operators can co-exist especially when private flights can help customers flying on scheduled airlines to destinations they don’t have routes for.

O’Hare also predicted that the regional market for private jet travel would grow at 6-8% in the region this year and next, with Royal Jet itself forecasting around 6% growth in 2014. Both figures are well ahead of the 4-5% annual growth forecast for business jet travel predicted by the Honeywell Global Business Aviation Forecast and the Bombardier market forecast.

Quoting the Honeywell report, he said in the last five years, Middle East & Africa growth was 7%, and is expected to contribute 4% of the global demand over the next five years. He also stated that there is a strong preference of large-cabin and long-range jets, accounting for the largest share of revenues (45%) over the next 20 years.

O’Hare further commented that there was a need to take into account the requirements of VIP customers when planning airport investment and infrastructure. “Major airports need to either encourage private investment in the development of improved Fixed Base Operation facilities or invest in their own infrastructure as this sector grows,” O’Hare said.

“Some major airports process VIP private jet customers through airline terminals, which defeats the primary reasons for private jet travel: speed, security and privacy. Even the provision of adequate parking for business jets needs to be factored into investment plans.

“The development of the region’s only dedicated executive jet airport at Al Bateen, Abu Dhabi is a proof point of the UAE capital’s recognition of the need for private aviation sector growth to be aligned with its aviation pillar within the Abu Dhabi Vision 2030 strategy. Royal Jet too will extend its operational base to Al Bateen at the end of 2015, in addition to maintaining its FBO at Abu Dhabi International Airport as part of its long-term commitment to the industry.”

O’Hare told delegates that he predicted more consolidation at the smaller end of the private aviation sector due to competitive pressure. At the higher end of the market, the quality of product and service delivery would determine which companies survived and thrived, he said.

“Some people believe the private jet industry is driven by price, but I believe that the keys to success are product and service,” he told the audience at a panel session on business aviation. “Price is a factor, certainly, but the future belongs to those operators who excel at product and service delivery.”