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Why Dubai FBO expansion is so vital

Posted 28 May 2019 · Add Comment

ExecuJet Middle East vice president, Mike Berry, analyses the charter market and looks forward to the next big development in Dubai.

One of the first companies to have a serious presence in the Middle East was ExecuJet, part of the Luxaviation Group. The company moved into the region in 1998 and was the first to receive permission to operate charter flights from the UAE.
Mike Berry, executive vice president of aviation services for Luxaviation Group and vice president of ExecuJet Middle East, followed in 2002.
Back then, he was a financial director for ExecuJet and his economic acumen has informed his business decisions in the region ever since.
“In the Middle East, wealth is around every corner,” he said. “But, despite a dramatic increase in business aviation movements since the early 2000s, the market is still young – and not without its growing pains.”
While the typical aircraft owner began to shift from the single, ultra-high-net-worth-individual (UHNWI) towards corporations a decade ago, this trend stalled during the 2008 financial crash and, according to Berry, never really recovered. So, how has ExecuJet adapted its offering for today’s single-owner market?
“Customer expectations are really high,” Berry said. “But market fluctuations from political, social and diplomatic events can make pricing that bit higher in the Middle East. Customers expect costs to be equal to those in Europe or the US, because they speak to consultants who are used to working in those more established markets, so they often get inaccurate advice about parts, services and repairs.
“Plus, the environment’s more challenging for aircraft in the Middle East. Climactic conditions such as sandstorms cause erosion, which can spell a higher frequency of maintenance.”
Individuals are also likely to have higher standards when it comes to discretion, which will be enhanced when ExecuJet combines its two Dubai FBOs into a single operation at Al Maktoum International Airport.
At present, ExecuJet has five FBOs in the Middle East, at Dubai International Airport; Al Maktoum International Airport; Istanbul Atatürk Airport; Istanbul Sabiha Gokcen International Airport; and King Khalid International Airport in Riyadh.
“Apart from the dramatic slowdown over the past year as a direct result of the Saudi Arabia corruption clean out, we had been experiencing year-on-year growth in business aviation movements through ExecuJet’s two FBOs in Dubai,” said Berry. “This means our infrastructure needs expanding if we’re going to continue to provide the level of service our customers expect. Specifically, the new FBO will be located separately from existing terminal operations, so clients will be able to enjoy a private and personalised service.”
The $30 million, 25,700sqm facility at Al Maktoum will be designed as a three-storey building, featuring a presidential suite, airside hotel room suite, transit lounge smoking area and bar. There are plans for 13,800sqm of on-site hangar floor space and a dedicated parking hangar, to ensure it is equipped to manage the rising demand for business aircraft operations in the region.
“Additional parking space was non-negotiable for us when we were planning the facility at Al Maktoum,” noted Berry. “These days, our customers are flying as much for leisure as for business, which means they’re choosing larger aircraft capable of accommodating extended families plus au pairs, staff, even pets.
“As a result, we’re seeing more of the larger Embraer and Bombardier aircraft types coming through the doors. The range capabilities of these aircraft are also important to our customers – the Global 7500, for example, can fly 7,700nm. That’s the equivalent of flying direct from Dubai to Los Angeles.”
It appears Dubai expansion is crucial for Luxaviation Group’s business strategy, following the sale of ExecuJet’s MRO facilities to Dassault.
According to Berry, the company is refocusing on its core aviation services – VIP charter and aircraft management, and its global FBO network.
“Approximately 20% of Luxaviation Group’s overall business stems from the Middle East,” said Berry. “It’s an emerging market, but a promising one. We were the first aircraft management and charter operator to make a mark in the region and we’re pushing to retain that top spot. By concentrating on innovation and investing in the sector’s development, we’re confident our steady growth will continue to rise.”

 

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