Business jets: no room to spread their wings? - Monocolumn | Monocle


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19 August 2010

The Latin American Business Aviation Conference & Exhibition (LABACE) in São Paulo is the second largest corporate jet fair in the world (after Geneva’s EBACE) and, like everything in Brazil, it’s growing. Brazil’s business jet fleet is the second fastest growing after China, but the country’s aviation infrastructure is being tested to its limit.

While GDP is growing at more than 6 per cent a year, the aviation market grew 27 per cent last year. Combined with the growth of Brazilian multinational companies, business jets are fighting for room, as space and money is given to the commercial airline sector. Francisco Lyra, president of the Brazilian Association of General Aviation (ABAG), which organises LABACE, is frank about the problems. “The government and regulatory agencies aren’t on our side. They say ‘how can we protect you if the best public interest is with the commercial airline business?’” he says. A recent Mckinsey report funded by the government suggested moving all jet traffic from the main airports to a regional one two hours away from São Paulo, defeating the object of time-saving inherent in business aviation.

ABAG is lobbying the government to allow a new, private-sector-funded airport just outside São Paulo, handling only business flights, but it’s a struggle.

The issue isn’t just bureaucracy – it’s also about image. “We failed to spread the wider message that a business jet isn’t just a symbol of wealth, it’s a vital business tool for spreading wealth,” says Lyra. “The benefit is far greater to a nation’s economy than it is to the individual. China gets this – they’re building 50 airports at the same time. Brazil is building none.”

Bureaucratic wrangling and image problems are something that Roger Sperry, vice president of international sales at Gulfstream, recognises: “The Brazilian government needs to invest in more airports with better services to support internal and external jet traffic. We’ve seen similar issues before in Japan. The problem is that people still think a business jet is just to show off wealth; it’s not, it’s to generate wealth.” 

For the time being, the mood is still optimistic, with record attendance at LABACE this year. Bombardier sold three jets on its stand, which is virtually unheard of (business jet fairs are for discussions, not sales) and ABAG estimates around $500m (€390m) of business will result from the fair this year compared to $350m in 2009. It might take a long time to shed the “boys’ toys” image of the private jet in wider society but in the meantime the Brazilian government might do well to cooperate and make room for such a ripe market, not clip its wings.


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