Private-jet sales begin taking off

A business owner says that 41 million for a private jet is a good investment.
SEATTLE (AP) -- When Miami Dolphins owner Wayne Huizenga used to fly in style, his Gulfstream jet had room for only a dozen or so guests. Now his private jet of choice fits more than twice that many passengers in a cabin that would seat almost 150 as a commercial airliner.
Whether flying to one of his team's road games or hopping over the Atlantic to treat his buddies to a golfing tour in Ireland, the billionaire businessman is among a growing number of corporate executives and uber-rich A-listers who have gotten hooked on flying in the comfort of their very own, very large planes modeled after the aircraft flown by commercial airlines.
Huizenga doesn't consider his 41 million Boeing Business Jet a luxurious toy. He sees it as a sound investment that's paid off with a generous boost in business productivity.
"I had six public companies at one time," Huizenga said in a recent interview from his office in Fort Lauderdale, Fla. "The employees, the management team -- they get so much more done in a shorter amount of time. ... I realize it's expensive, but I think you make it up because you get more deals done, you do more things in a given week than you would otherwise."
Increasing sales
In the first nine months of this year, worldwide shipments of business jets jumped more than 20 percent over the same period last year to nearly 630 aircraft, according to the General Aviation Manufacturers Association, a trade group based in Washington, D.C.
Boeing Co. and Airbus SAS make the largest business jets on the market, modeling them off narrow-body aircraft. However the vast majority of business jets sold each year are smaller models.
Small to midsized business jets have enjoyed an even bigger bump in sales and shipments over the past two years than their bigger cousins, based on data from the General Aviation Manufacturers Association.
Improving economy
Industry insiders say VIP jet sales have heated up in the last few years as an improving global economy has pulled commercial airlines out of the industrywide slump that followed the Sept. 11, 2001, terrorist attacks. The improving economy has also forced business leaders to fly more often and over longer distances.
"If you're an executive and you need to visit several sites ... especially today with all the security hassles, it could easily take you a couple days to visit a couple of places," said David Velupillai, a marketing manager for Airbus' executive and private aviation unit. "But in a biz jet you could do both in the same day."
Another offshoot of the improving economy: a longer list of people who can afford to think big when they're shopping for a private plane.
Boeing sold 14 business jets last year -- more than the previous two years combined. It's sold 10 so far this year and expects to announce more sales by the end of the year, said Steven Hill, president of Boeing Business Jets, a Seattle-based joint venture Boeing formed with General Electric Co. 10 years ago.
Airbus has sold 22 of its of its VIP jets this year, setting a record for a division of the Toulouse, France-based company that was established a year after Boeing's business jet unit.
In addition to their lines of business jets, Boeing and Airbus also sell their wide-body planes in VIP configuration. Boeing has sold about 200 of them over the years, including several of the new 747-8 stretch jumbo and long-range 787 recently. About 40 Airbus wide-body planes have been configured for VIPs.
While Airbus gets most of its private jet orders from corporations, wealthy individuals make up Boeing's biggest client base, followed by heads of state, businesses and charter carriers.
Luxury
VIP jets come with larger cabins than their commercial counterparts and are fitted with auxiliary fuel tanks that can almost double their flying range. Customers buy them in "green" condition -- no walls, ceiling or carpeting, no seats or galleys -- then send them off to completion centers, which often spend a year outfitting the interiors to the buyer's liking.
Common layouts include bedrooms and gold-plated bathroom fixtures. Many are decked out with top-of-the-line entertainment systems and high-speed Internet connections, or dining room and coffee tables so finely polished they shine like mirrors.
Over the years, many customers have gotten choosier about their designs, said Jeff Bosque, president of Associated Air Center in Dallas, a completion center that finishes planes for both Boeing and Airbus.
"The majority of clientele are men, ultra-high-net-worth individuals, so most of them typically have an external designer that we work with that might have done yachts, or homes or apartments for these people, so we try to incorporate some of their design elements," Bosque said.
It typically costs about 15 million to get a narrow-body plane finished. Much of that cost is tied to getting airworthy-certified furniture, walls, carpeting and other interior finishings, which have to be lightweight and fire- and crash-resistant.
Huizenga bought his Boeing jet for 30.5 million in 1997 and spent 10.5 million on the completion job. Most VIP jet customers ask that their purchases be kept secret, but the Dolphins logo Huizenga had emblazoned on the tail of his plane dashed any hope he might have had to keep his ownership quiet.