Jet Makers Introduce Two Lines Of Corporate Aviation Products

Anticipating growing demand for private jet transport, two airplane manufacturers last month introduced product lines that they designed specifically for the corporate aviation market. Canada's Bombardier is using its Canadair Regional Jets as a template for a family of medium-size corporate shuttles, while Brazil's Embraer launched a long-term program to bring two new smaller business jets to the corporate market.

"Across the globe, there is continuing recognition of the value that business aviation brings to companies through improved employee productivity and increased access to new markets," said Ed Bolen, president and CEO of the National Business Aviation Association, last month at the annual European Business Aviation Convention & Exhibition in Geneva. "Flight-planning and aircraft-handling companies see international flying up about 30 percent overall and market predictions for worldwide deliveries of new business aircraft are bullish."

In a forecast issued this spring, Teal Group consultants said manufacturers would produce more than 7,400 business aircraft in the next 10 years, up by nearly 1,000 from a similar report issued last year.

"After tremendous growth in the 1990s, the business jet market stalled in the early years of this decade, leading to fears of permanent market deflation," said Teal analyst Richard Aboulafia. "Last year, however, saw a hopeful recovery, with double-digit growth in the value of deliveries over 2003."

In addition to larger companies, which may operate their own aircraft for executive teams or corporate shuttle services, more smaller and medium-size companies also are using wholly owned aircraft, according to recent Business Travel News research.

In comparing 2005 with 2004, the percentage of smaller companies polled that use such planes increased from 13 percent to 30 percent, while usage among medium-size companies grew from 16 percent to 23 percent.

Bombardier last month introduced a series of new corporate shuttles in the Challenger family. The three models—the 850, 870 and 890—are based on Bombardier CRJ regional aircraft, which total more than 1,200 now in scheduled service.

"In addition to a significant fleet of some 225 older-generation aircraft currently in shuttle service, our research indicates that corporations worldwide require more flexible, secure and economic transportation solutions for their employees," said Bombardier Business Aircraft vice president James Hoblyn.

Bombardier's target customers include multinational companies flying personnel to remote areas. Bombardier said those companies' reliance on commercial airline schedules limits their ability to maximize productivity and reduce operating costs.

In the standard cabin configuration, the aircraft seat 50, 70 and 90 passengers, respectively, in a two-by-two layout similar to economy class on commercial CRJ planes. A split-cabin setup includes "executive-type" seats in the front and economy seats in the back, with a total capacity of 32, 44 and 52. The top-end configuration offers business class seating throughout the cabin and seats between 27 and 52 passengers. All models have at least 31-inch seat pitch.

Embraer also is expanding its corporate jet portfolio. The Brazilian manufacturer last month announced plans to enter the light jet and very light jet categories, building on penetration in the business aviation market established with its Legacy jet.

The company said the first very light jets—which would seat between six and eight passengers—could be in service by 2008, at a price of $2.75 million. The slightly larger light jets—accommodating eight or nine passengers—could be ready a year later, priced at $6.65 million.

Embraer, which said it already has delivered 49 Legacy private jets to customers in 12 countries since 2002, estimated the demand for light and very light jets at 3,000 during the next 10 years, excluding air taxi services.

"The introduction of these new and exciting aircraft is becoming more of a reality as prototype engines and airframes rapidly move from design studio to flight test," said NBAA's Bolen of very light jets. "Although estimates vary, most industry forecasts suggest that the market for VLJs and other technically advanced aircraft will be strong over the next decade."

Meanwhile, even before entering commercial service, the megajumbo Airbus A380 has been eyed as a potential corporate jet. Aircraft maintenance firm Lufthansa Technik last month announced a preliminary agreement with Airbus to configure individual A380s for private use.

With no such orders from any parties, A380s as business jets is a development over the horizon, as is a sound-barrier-busting private jet replacement to the Concorde.

"We remain strong believers in a supersonic business jet," said Teal's Aboulafia. "We forecast a 60 percent chance of an SSBJ program launch in the next 10 years and an 85 percent chance by 2020."