Photo: Photo by Larry Busacca/Getty Images, Courtesy of VistaJet
Private charter jet company VistaJet made headlines this week when it placed a $3.8 billion order for 56 planes from Bombardier and took out an option for 86 additional aircraft, making it the biggest deal in private business aviation history.The sale doubles the size of VistaJet’s fleet, putting dozens of Bombardier’s top-of-the-line Global aircraft in the skies.
The magnitude of the sale is particularly impressive, considering the bad rap private jets received in the wake of the recession.
But VistaJet’s growth story is as impressive. Founded in 2008 by German entrepreneur Thomas Flohr, the company had 25 per cent revenue growth this year, following 22 per cent revenue growth in 2011.
It’s achieved that growth not from focusing on domestic clients, but from servicing clients in emerging markets where the financial crisis was less of a factor and where there is tremendous entrepreneurial growth, Flohr said at a lunch announcing the Bombardier deal this week.
In the past, when future entrepreneurs from emerging markets in Asia and Africa studied in the west, they stayed and built careers there. But now, those same entrepreneurs see tremendous opportunity in their home countries, and are more likely to return and build businesses where they came from, Flohr said.
At the same time, it’s become less critical for businessmen in emerging markets to meet in a hub like London or New York, said Flohr, adding, “entrepreneurs are doing business directly, from China to Angola or from Nigeria to Saudi Arabia.”
But because commercial airline infrastructure can be lacking in those countries, it’s often impossible — or at least incredibly time consuming and expensive — for those businessmen to meet face to face.
That’s where VistaJet came in, and where it has seen its service take off. The company’s jets made 10,000 international flights in 2012, and have landed at 136 airstrips in Africa this year.
“We caught the megatrend early on,” Flohr said.
The service isn’t cheap; VistaJet planes, which fly anywhere in the world on 24 hours notice, cost $15,000 per hour. But considering the cost of commercial airfare from remote places, it can become a viable option, especially when companies are transporting multiple executives and paying for hotel rooms.
The deal with Bombardier is a sign that Flohr sees huge growth potential among businesses in emerging markets.
“Such customer success allows us to place this historic order and will enable us to base even more brand new aircraft in these dynamic growth markets,” Florh said in a statement. “I am excited to serve these markets with an unparalleled product both locally and globally.”
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