ALL THINGS BIG AND SMALL

You have heard all the details and mayhave even felt the difference thatowning one makes to your business

day by hiring a charter - all about how muchtime you save and time after all is money.Soyou decide you want to join the exclusiveclub of,literally,high flying executives andgenerally rich people by acquiring yourvery own private jet. The process of goingahead and getting one can take as long astwo years right from deciding for that youwant one to actually boarding your ownbusiness jet for that last minute farawaymeeting.

Manav Singh who heads the Delhi basedair charter company Club One Air and alsorepresents Eclipse in India says that thereare at least a 1,000 Indians that have theneed for a business aircraft but they yetdon't realize the benefits.

"There is an educational process that isinvolved where many realize that whileowning a business jet can cost around Rs 25lakh to around Rs 2 crore,the sheer time sav-ing more than makes up for the money.

The first step, according to most peoplein the business, is deciding why you wantone. Do you want it because everyone elseyou know has one or you want to impressall your friends with your new toy. Or areyou driven by practical reasons as you needto be able to be in five different parts of theworld or country within the same day.

"There are a number of decision makingcriteria involved like the range of the air-craft you need to the financial benefits ofowning a business jet," Nilesh Pattanayak,who represents Bombardier in India says.

"If a person is buying out of need thenthey have to ask themselves whether the air-caft will add to their topline or bottomline,"he adds. "Do I travel a lot is essentially thefirst question," Pattanayak says.

The there is the range question. A per-son would have to look at aircraft that canreach a minimum of 80% of their destina-tions.

Singh agrees saying that the first step isto see what he usage is.Whether the poten-trial buyer is a major traveler and if he trav-els within the country then does he staywithin the metros or also go to tier II and tierIII towns. '

"The infrastructure of the destinationsare a major decision maker as give theknown lack of up to the mark infrastruc-ture in the country the buyer has to decideon an aircraft that fits the existing infra-structure," Sigh says.

Then of course is the budget.How muchcan you spend on the aircraft.Globally,pri-vate and business jets cost anywhere be-tween $1 million to $50 million and there isno point buying a Boeing Business Jet ifyou are going to travel to Kanpur.

Then you have to decide the size of theaircraft you need - rarely is it used for fam-ily traveling like a car.Then you have to de-cide on the level of amenities and luxury in-

side. Televisions to Jacuzzis to whateveryou want can be modified and put in an air-craft depending on how much you are will-ing to spend.

Once you have decided on what you wantin your aircraft then next step is to get intouch with the various agents in the coun-try. These agents will help you decide onwhich aircraft to buy apart from other in-tricacies and details like whether to go infor a second hand aircraft or a new one.

All the major aircraft manufacturersonly deal with their sales agents in Indiaand getting an aircraft without their helpis almost impossible.

Once an agent has been selected andthen an aircraft, then the process begins."The process to buy an aircraft consists oftwo parallel processes - internal and exter-nal," Singh says."There things like import-ing, customs and DGFT (directorate gen-eral of foreign trade) clearance after whichthere DGCA and ministry of civil aviationclearances with a non-scheduled operatorspermit (NSOP)," he adds.

There are other requirements like secu-rity clearance and money remittanceamong others that are usually taken care of

by the agent.When buying a second hand aircraft, a

buyer has to look into things like low time,accident history, owner history (one air-craft should not have too many owners) etc.

When deciding on how much a secondhand aircraft should cost, one has to referto something known as the blue book,which is an index of how much an aircraftshould cost, given the age and other fac-tors.This index coupled with factors like listprice and economy and market conditionsare the main deciding factors when buy-ing an aircraft.

All aircraft have to be certified by the gov-ernment of airworthiness.

Simultaneously, one has to engage aflight crew and maintenance crew of theaircraft.There are many companies in thecountry that allow you to outsource thispart of owning an aircraft to them."Usuallythe company that is charging more and islarger in size is a better bet as a feeling ofsecurity as far as an aircraft goes is very im-portant," Singh says.

If a person wants to start a charter com-pany,then they are not required to pay 28%excise on the aircraft to be imported apart

from which they also get a separate nonscheduled permit for charters.

For this, the eligibility conditions aresimilar to the individuals licence. Theyhave to present a viable business plan to theDGCA and the ministry of civil aviationand also fulfil the minimum equity norm.There is also a requirement for securityclearance from the ministry of home af-fairs and an import permit needed fromthe Directiorate General of Foreign trade.

Security clearance is also needed fromthe Bureau of civil aviation security.

The equity norms for the non scheduledoperators permit are based on the size of thefleet.For a minimum fleet strength of upto3 aircraft or helicopters,the equity norm isRs 1 crore.For a minimum fleet strength ofbetween four and 10 aircraft or helicopters,the equity norm is Rs 2 crore. For a mini-mum fleet strength of above 10 aircraft orhelicopters, the equity norm is Rs 5 crore.

However,in the case of an existing com-pany operating aircraft either in privatecategory or as a non-scheduled operator,instead of subscribed equity, its net worthequivalent to the above said amount wouldbe considered as meeting the minimum re-quirement to assess the financial sound-ness of such company or they may raise thesubscribed equity for the required amount.The applicant shall submit a certificatefrom the banker or chartered accountant toconfirm the paid up capital of the company.

Before the Non-Scheduled Operator'sPermit is issued, an applicant has to be inpossession of an aircraft either by outrightpurchase or through lease.

Aircraft acquired and certified in privatecategory (for individuals and not charters)cannot be used for commercial air trans-port services.

The owner has to have his own mainte-nance and repair facilities for carrying outthe maintenance as per DGCA require-ments specified in CAR Sec-2 before get-ting the licence.

The owner can make suitable arrange-ments with any other DGCA approvedmaintenance organization, for all mainte-nance including line maintenance of thetype of aircraft.The operator shall provideto DGCA a copy of the agreement madewith the maintenance agency in this re-gard. A person in the organization and ac-ceptable to DGCA will be designated to en-sure that the maintenance is carried out asper DGCA approved programIf a personwants to start a charter company,then theyare not required to pay 28% excise on the air-craft to be imported apart from which theyalso get a separate non scheduled air trans-port permit for charters.

CITATION XLSAt present the world's fastest business jet. This midsize jet can fly youfrom the American east coast to west coast around 35 minutes fasterthan other comparable aircraft.

In addition to its hallmark speed, the aircraft offers a nearly 24-foot-long cabin with eight executive seats, a full refreshment center, a spa-cious aft lavatory and a baggage compartment that can hold 72 cubic feetof luggage.

The Citation brand of business jets encompasses six distinct "fami-lies" of aircraft, with the Excel as the basis for one of these families. TheCitation XLS was the first "makeover" that the Excel received.

Besides a glass cockpit based on the Honeywell Primus 1000 EFISavionics suite, the XLS featured the upgraded PW545B engines with in-creased performance.

This aircraft sets you back a cool $13 million which is considered notbad for the speed and the comfort.The Citation XLS+ is the first of the XL line to feature Collins Pro Line21 Avionics and a 4 tube EFIS display.

Want one? Which one? What to do and how to do it...Right from figuring out that you need or want one to actually boardingand flying into the abyss on a private jet, the process can take aroundtwo years. Here is a little help to get you started

EMBRAER LEGACY 600The Embraer Legacy 600 is the business jet deriv-ative of the Embraer ERJ 145 family of jet aircraftfrom Brazilian aircraft maker Embraer.The Legacy is based on the shortened ERJ 135model, but includes added range with extra fueltanks and added winglets,similar to those on theERJ 145XR.Launched in 2000,the Legacy is capable of carry-ing 16 passengers in comfort for 3,050 NauticalMiles (NM) or 8 passengers for 3,450 NM. Consid-ered worth the buy for its $25 million price tag.

AIRBUS A320 PRESTIGEThe A320 Prestige features the most spacious cabin in the corporate jetmarket, with the same wide cross section as the A318 Elite and the ACJ.This configuration allows 30 passengers to travel in unparalelled com-fort in each of the different cabin areas of the aircraft.

THE ROUTE TOBUY AN AIR-CRAFT CON-SISTS OF MANYPROCESSES -INTERNAL ANDEXTERNAL.THINGS LIKEIMPORTING,CUSTOMS,DGFT CLEAR-ANCE AMONGOTHER ISSUESLIKE SECURITY

Editorial: Shauvik Ghosh

Project Co-ordinator: Rajiv Girhotra

Design: Vanita Arora

GULFSTREAM G550Easily considered one of the most high-end business jets, especially sinceit comes from the Gulfstream stables. The G550 was released to the marketin 2003 with increased performance and range of 6,750 nautical miles(12,500 km) making it the the longest range business jet in the world.

A new aircraft sets you back a cool $60 million and boasts customerslike Berkshire Hathway promoted Netjets and the US air force and Navy.

The Gulfstream 550 competes against the Airbus Corporate Jet, BoeingBusiness Jet, and the Bombardier Global Express.

DASSAULT FALCON 7XThe Dassault Falcon 7X is a large-cabin, long rangebusiness jet manufactured by Dassault Aviation andis the flagship offering of their business jet line. It wasfirst presented to the public at the 2005 Paris Air Show.

The aircraft has over 165 orders to date, and has itstype certification from both FAA and EASA.

In 2001, the Falcon 7X, with a price tag of approxi-mately $35 million, was nearly $10 million cheaperthan its nearest competitors in the long range, largecabin market segment, the Gulfstream G550 and Bom-bardier Global Express. Its 2007 cost is $41 million.

4 JULY2008