Rich pinched, private jets lose traction
India's business aviation sector is witnessing a slowdown, thanks to the demand for private jets coming down drastically in the last one year.india Updated: Jun 20, 2012 22:40 IST
India's business aviation sector is witnessing a slowdown, thanks to the demand for private jets coming down drastically in the last one year.
Many of the country's top business houses who had placed orders for corporate jets have either pushed back deliveries or postponed plans.
A personal jet could cost anywhere between $3-70 million.India, which has been clocking one of the fastest growth in the business aviation industry in the world, boasts of a fleet of around 140 personal jets. The country has the second-largest business jet fleet in the Asia-Pacific region according to the Business Aircraft Operators Association (BAOA).
"Demand has gone down drastically and cost cutting is in," said Rohit Kapur, president, BAOA. "Profitability and bottomline are guiding a company's decision to acquire an asset of this calibre," he said.
Growth, Kapur said, had fallen sharply in 2011. From around 20 private jets purchased by Indians in 2010, the number stands at a mere eight in 2011.
Vivek N Gour, MD, Air Works India Engineering, agreed. "Purchases of private jets have slowed down in the last 12 months," said Gour.
The price of a private jet is guided by its size, range and the number of passengers it can seat, said Nick White, vice president, Air Works India Engineering. However, the global economic slowdown, he said, had an impact on India to an extent, he added.
"There is a slowdown and companies are thinking twice before splurging," said Sharan Lillaney, research analyst, Angel Broking.