ExecuJet Aviation will operate a temporary standalone FBO at Al Maktoum International Airport (Dubai World Central—aka “Dubai South”) until a permanent facility is constructed by late 2018. Mike Berry, president aviation services and vice president, Middle East, said the company would continue to operate its FBO and MRO facilities at Dubai International, but was increasing its focus at DWC as the southward migration of business aviation continued.
ExecuJet (Stand 598) staked its claim early on for a standalone space at DWC. Other FBOs at the airport are obliged to operate from their own portions of a single central terminal. The interim ExecuJet FBO, opened this summer, had been serendipitous. “We were very fortunate to get our hands on this piece of real estate. And honestly, after we got the notification to vacate [the interim facility], because of expansion, we didn’t have a solution other than going back to the central terminal in Dubai South, which was not ideal, because we have always been standalone,” he said.
“Having a look around, nothing was available, but we had a good look at this property, and saw beyond what the shell was. I must say, it has turned out to be better than what we expected. It’s an interim solution, and we invested in the ExecuJet look and feel. We wanted our customers to have that same experience given we envisage that we are going to be here at least until the middle of 2018, depending on how construction on our new facilities goes.”
ExecuJet is well placed to leverage opportunities in the Middle East hub. “Today, as we go into MEBAA, we have our full presence at Dubai International, the two hangars and the FBO, we have this interim Dubai South FBO, and we are in the throes of finalizing the design concept with our consultants for the new facility, for which the plots we have allocated are alongside the DWC MEBAA show complex,” he said.
Berry added that the expanded FBO and hangar would consist of three plots, all next to the runway, each plot being 7,360 square meters (79,2223 square feet). The plan is to accommodate the FBO, MRO facility and a parking hangar. Ramp space in front will be an additional 4,738 sq m (51,000 sq ft), he said.
“We hope that by early next year, within the first quarter, we will have gone to market, awarded the contract and started breaking ground,” he said. The interim facility offers ExecuJet exactly the solution it wanted, in giving clients the “ExecuJet feel” and matching its facilities elsewhere around the world. “It gives us standalone, where our clients can experience the ExecuJet service,” he said.
“It’s a very streamlined process. They arrive, drop off in front, cars are waiting airside and they are driven off to their aircraft. No one’s around, looking to see who’s arriving or departing. That was key in trying to identify a location. The private lounges go down very well. We also have lounges for drivers so that they can sit and wait for passengers. We are just missing duty free. Our ramp parking is directly opposite, a short drive away, very much alongside the passenger terminal building. Before, we had a longer journey to get to an allocated parking area.”
Slow Market
Market conditions have yet to pick up. “The market is still very much depressed in this part of the world. I don’t think we are getting to the levels that we expect, from [our] point of view. We try to closely monitor how we are doing in the market in terms of size. Traffic volumes remain down and the new FBO is not being fully utilized. Unfortunately, we commissioned it in the middle of summer, when traffic was right at a low.
“We are waiting for the traffic to come back, and it is picking up slowly, so that we can start utilizing the asset as it should be. Like everybody who’s put in assets here, unfortunately, there has been a dip in the last two years. We have also seen a drop in MRO traffic. FBO traffic is increasing, but still not at the levels we want to see.”
Berry blames the poor market on several causes. “It was a combination of factors that finally caught up with the region: unrest, and the oil price, the economic situation in Russia; we never saw those Russian tourists coming through Dubai like we used to, charter flights coming in with 40-50 passengers. We had our first recently, and we hadn’t seen one of those flights for well over a year. That’s an indication that the economic pressures around the world and the flights into and through Dubai have just dried up,” he said.
Last year’s Luxaviation-ExecuJet merger continues to progress. “The merger has been successful and we are starting to [see] momentum on some of the integration and the economies of scale in growing the overall fleet. Integration has been happening from our central operation center in Cambridge, from where we provide dispatch, CAMO support and training, and we’ve been busy integrating all the Luxaviation aircraft on the ExecuJet platform. That’s still ongoing. We have just over 1,500 employees in the group and over 250 aircraft.”
Berry said ExecuJet operates 18 aircraft in the region. “Our charter fleet has not really grown. Our A6 [Dubai-registered] fleet has shrunk; we just lost one aircraft, so we are down to four [on] charter: two Global 5000s, an Embraer Lineage and a Falcon 900. The other aircraft in the fleet vary from a Learjet 60 to Globals. The private owners operate their aircraft under Isle of Man and other offshore jurisdictions from Dubai and locations in the region.”
He is wary of calling any market recovery. “I have no big picture on that other than we believe in the future of the region; that it will always come back. We believe in Dubai South, which is why we are investing heavily, to the tune of over $40 million. We wouldn’t do that if we didn’t believe the market would come back at a certain point in time. Everything being geared up for Expo 2020 will certainly bring more traffic through Dubai South again. So we are certainly very hopeful in the build-up to that,” he said.
“On 2015 movements, we are slightly up. I think the market operators see about 13,000 to 14,000 movements a year. People are adjusting their views downwards. We thought that if the market could reach about 18,000 or just under 20,000 movements by 2020, that would be very good. All the indicators were that it could happen, but trends [are hard to discern].”
ExecuJet offers 24/7 MRO support at Dubai South and has done so for over a year, with technicians offering AOG and line maintenance support operating out of rented accommodation and small business units. “When we need indoor hangar space, we approach people around us,” he said.
Berry believes people are not talking about the illicit “grey” charter market any more, even though it is still prevalent. “The debates in conferences and the media coverage chased some of it off, but there’s no doubt it still happens.”
Global Expansion
As president of aviation services, Berry’s eyes are not fixed only on the Middle East. “As a global business, we are now operating 24 FBOs and growing. There is a lot of interest in new opportunities. Our recent acquisition of St. Martin in the Caribbean is our first step into that region. We have also developed an FBO in Mexico, on top of our AOC management business.”
ExecuJet’s joint venture in Riyadh with NAS Holding has also seen a slow summer. “We started operations to the Royal Terminal at King Khalid International Airport. There is talk of now reenergizing the project we all participated in years ago to build a new terminal. We’ll see how that develops. Given the hardware sitting on their ramp, and the number of aircraft passing through, it would be good [to replace it].”
It also has a new joint venture in Delhi. “That’s been running for awhile and is picking up very nicely. We are in the design concept [of] building a new central terminal with the other licensed concessionaire.”
At least Berry can be satisfied with ExecuJet’s current regional mission, which is to “construct our new Dubai South facilities and present to the market that what we’ve been talking about is a reality. This FBO facility gives us a great foothold to grow our business in Dubai South. Our FBO business continues to be good for us. Our focus here is to capture the opportunities that we can, and build our new facilities,” he said.
“For the Middle East, we are…trying to retain a managed fleet of aircraft owners who we can provide an exceptionally high service to. We’ve just recently lost another two aircraft due to them being sold. To replace them is difficult, because there are not many new aircraft coming in on a regular basis. And by new, I mean newly bought or pre-owned by a new foreign owner. In today’s climate it’s difficult to grow our fleet by 20-25 percent.”