ZOOM
HALF-PRICE Reasonably priced jets Last issue we looked at 30-million-dollar aircraft, both new and pre-owned. This time, especially minding the shaky economy, we decided to halve that amount and see what $15,000,000 could get. It’s surprising how good the offers are, although the better planes have been around for a while.. BY Ivan Veretennikov
AA22-54-61-Comparison.indd 55
2/12/12 9:52 AM
ZOOM
Bombardier Challenger 300
H
ow much is it? $15,000,000. Not a lot in the peak years of 2007—2008, when it would get only a small plane. With prices for new aircraft constantly rising, delivery slots sold at huge premiums, and the best options changing hands in a matter of days on the pre-owned market, this was a time when private jet ownership could strain almost any pocket. On the other hand, saving wasn’t ‘in’: people in emerging markets were borrowing much more than was good for them to buy large aircraft. Today, everything has changed. Charterers have learned to combine airline business class with short and much cheaper hops to final destinations, while buyers are more considerate in the choices they make.
Bombardier Challenger 300
For many this is a good thing – prices have reached their reasonable minimum, and the shopping frenzy has given way to carefully calculated comparisons. In effect, $15 million is getting you a lot more today than it would have in 2008. For the sake of argument, a 2004 Embraer Legacy would be offered at $26 million in 2008 ( the same as a new aircraft), now a 4-year plane might just meet our budget – almost half as cheap as a new aircraft which is currently over $27 million. Before moving on, a good piece of advice from Rolland Vincent, President of Rolland Vincent Associates, and essentially the reason why acquisitions are better handled with the help of a professional: “For any purchase (new or pre-owned), I think the first step is
Hawker Beechcraft 4000
56 I ALTITUDESARABIA
AA22-54-61-Comparison.indd 56
2/12/12 9:52 AM
ZOOM
to thoroughly analyze the required mission to determine range, passenger and payload requirements, and the desirability of operating from specific airports.” Age Difference Buying a new aircraft has major advantages, just like buying anything fresh from the factory. You can choose the options, cabin layout, and interior features, while enjoying manufacturer’s warranty, better financing solutions, free crew training, etc. This flexibility comes at a price, and in today’s market $15 million won’t buy much cabin space. There is one other drawback, in that delivery will not be immediate, taking even a year or two in some cases. The lower operating costs and higher value on the pre-owned market, however, may well be worth the wait, as well as the ability to buy cutting-edge technology. Although business jets do not benefit from age, unlike wines, a 5-year aircraft is far from old. In fact, given the generally low hours characteristic of business flying, anything up to 5 years of age can be considered as good as new. Even a 10+ year business jet won’t be “old”. A bit outdated, perhaps, but depending on how well it was kept, it may well have another 20 years ahead of it. With fashion trends changing at a much slower pace than in the automotive industry and many of the innovations available for retrofitting, pre-owned aircraft may in some cases be even more attractive than new ones. Look out for higher depreciation rates and operating costs, inspect the lists of installed equipment and avionics, and make note of upcoming scheduled maintenance – or ask your consultant to do it for you.
eight passengers still have sufficient room for a two-three hour journey, but the comfort standards are very different to those in large and ultra-long range business jets. Don’t expect to be getting any exercise in these aeroplanes, and remember what Bill Lear said: “If you want to take a walk, go to Central Park.” The Legacy 450, a new offering from Embraer, is a lot more spacious than the rest, with a flat floor, genuine stand-up cabin at 183 cm, and large windows adding to the feeling of space. New stylish seats fold seamlessly into berths, while the amount of leg and shoulder room is stunning for this price tag – $15.25 million. Add fly-by-wire, unseen on aircraft of this class, and an abundance of safety features that challenge even the heavyweights, and it makes you wonder how Embraer managed to keep the price so low. The speed and range aren’t as good as those of the G150 or the Learjet 60XR, however, and until it enters service in 2014 we don’t know what it costs to operate. Let’s look briefly at the other models: The XLS+ and Hawker 750 are sturdy, reliable aircraft, slower than the others, but costing significantly less than $15 million. The 750 has the highest variable costs. The XLS+ boasts the best runway performance, but its baggage compartment is relatively small.
The Learjet 60XR needs a really long runway for its size, but it is fast, with a phenomenal rate of climb, a good range, and low operating costs. The G150 – although not a “pure” Gulfstream – flies farthest, has the highest cruise speed, and costs more than the rest. Just like its big brothers.
Bombardier Challenger 604
Factory-Fresh Buying new aircraft with the 15M budget, we would be choosing from midsize business jets. Solid performers from leading manufacturers, offering ultimate value for money. The Learjet 45XR and 60XR, Cessna Citation XLS+, G150, and Hawker 750 are rather compact, sit-down aircraft, all having a trench running down the cabin between the seats on both sides. The 45XR is the smallest, with a cabin just 150 cm tall and 156 cm wide. Its
ALTITUDESARABIA I 57
AA22-54-61-Comparison.indd 57
2/12/12 9:52 AM
ZOOM
Hawker 750
Cessna Citation X
In terms of typical mission, the midsize aircraft we have been looking at would appeal most to flyers in Europe, where they easily connect all city pairs. Brian Foley of Brian Foley Associates says: “If most flying activity is focused in Europe, an owner in London could be content with a new aircraft albeit with shorter range. There are several new aircraft that would meet the $15M criteria, such as the Learjets, Hawkers, Citations and smaller Gulfstreams. If trips outside of Europe are routine, then they’d also want to consider long-range pre-
New
Model
owned possibilities.” In the Middle East these models can handle regional flights – India, North-East Africa, the Red Sea area. Only the G150 will reach all of Europe, including London. And from there it can go non-stop to New York, a key business destination for the region. Flying from Moscow, all of these aircraft will connect the Russian flyer with Europe, and most can reach Dubai. Matured in Air Real variety awaits on the pre-owned market. Relatively new midsize and super-midsize air-
Price Tag ($M)
craft, such as the Cessna Citation Sovereign, X, Challenger 300, and Gulfstream G200, are to be had alongside the larger Legacy 600 and the more luxurious – yet more venerable – Gulfstream G-IVSP, Falcon 900B/EX, and Challenger 850. Even bizliners may fit into this budget. Brian Foley remarks, however: “Converted airliners are considerations for those who value cabin size more than any other parameter. However with any benefit there are often tradeoffs, and with a converted airliner that would typically be slower speeds, lower altitudes, less access to some
Range (nm)
Advantages Lowest variable costs
Bombardier
Learjet 45XR
$13,150,000.00
1939/3591
Bombardier
Learjet 60XR
$14,100,000.00
2400/4445
Range, speed
Cessna
Citation XLS+
$12,600,000.00
1976/3660
Value for money
750
$13,300,000.00
2200/4074
Lots of cabin for the price
Gulfstream
G150
$15,000,000.00
3130/5797
Longest range, highest speed
Embraer
Legacy 450
$15,250,000.00
2300/4260
6000 ft cabin at FL450, Fly-by-wire
Hawker
Preowned Bombardier
Challenger 300
$15m
3320/6149
Modern design, low hours
Bombardier
Challenger 604
$11-15m
4027/7458
Wide cabin, will sell in charter
Bombardier
Challenger 850
$15m
2270/4204
Largest cabin
Gulfstream
G200
$10-15m
3400/6300
Modern design, low hours
Gulfstream
G-IVSP
$13-15m
4480/8301
Range/cabin
Dassault
Falcon 900B
$13-15m
4583/8492
Range/costs
Cessna
Citation Sovereign
$11-14m
3010/5575
Costs, runway performance
Cessna
Citation X
$15m
3125/5788
Speed
Embraer
Legacy 600
$14-15m
3433/6358
Value for money, will sell in charter
58 I ALTITUDESARABIA
AA22-54-61-Comparison.indd 58
2/12/12 9:52 AM
ZOOM
airports, high-cycle airframes and potentially higher operating and maintenance costs.” So, airliners aside, we have a lot to choose from. The two Cessnas are essentially competing against each other – the Challenger 300 and G200 are a step higher, with a stand-up cabin, greater range and payload. The Sovereign, in turn, has better runway performance than its stable mate, and is a lot cheaper to operate. On the other hand, if you wanted to save money, you wouldn’t buy a muscle car. The sheer adrenaline emanating from a Citation X may be enough to tip the scales in its favour, while its aerodynamics, technology, and performance remain a wonder in the world of business aircraft. Choosing between the Challenger 300 and Gulfstream G200, Rolland Vincent is “bullish on the Challenger 300, which has proven to be a popular, reliable, and desirable alternative to the large-cabin class of aircraft (the G-IVSP, Challenger 604/605, and Falcon 900EX). The newer the model, the better, in that this aircraft is likely to have the latest onboard systems and lowest time and cycles.” Alexey Korolev, Head of Analysis at Upcast, speaks for them both: “The advantages of the G200 are in longer range, bigger cabin volume, and Gulfstream’s impeccable aftersale support. On the other hand, the Challenger 300 is a very comfortable aircraft – the cabin is almost ideally balanced, and the floor is flat with no trench running down the middle.” The larger aircraft pose more questions. Challenger 850 aircraft available for this money will be around 14 years old and have circa 6000 hours on their airframes. This is the largest cabin of all, but at the sacrifice of max range. The Challenger 604 and Legacy 600 are traditionally placed in the same class, though the philosophies are quite different: the fuselage of the Legacy 600 is a long pipe, whereas the 604 is rather a short, but plump barrel. One will give you a 15-metre walking distance to keep your feet busy in flight, while the other will let you lie down sideways and stretch your arms – should you ever want to do so. The better range and speed of the
Hawker 750
Dassault Falcon 900
ALTITUDESARABIA I 59
AA22-54-61-Comparison.indd 59
2/12/12 9:52 AM
ZOOM
Learjet 45XR
60 I ALTITUDESARABIA
AA22-54-61-Comparison.indd 60
2/12/12 9:52 AM
ZOOM
Learjet 45XR
Challenger are offset by its greater age and many more hours on the airframe. In the long-range class, various modifications of the Falcon 900 (B, C, and EX are advertised by various brokers) take on the G-IVSP, a French beauty against an American classic. These were the best aircraft of their time and their specifications are no less impressive today. Add the sheer beauty of these sleek, powerful machines and it’s no wonder people who have the money seldom settle for less. Alexey Korolev mentions several disadvantages, however: “One should be careful when looking at long-range aircraft within this budget. First, the operating costs will be high. Second, only rather venerable aircraft can be bought with this money, and they might require serious maintenance, draining a lot of money if heavy repairs or interior refurbishing are required. Besides, at 10 years and over, they will be hard to sell later on.” Time to Choose It is always hard to be impartial when it comes to choosing one model out of several.
There’s no such thing as a “bad” aeroplane (as long as you don’t look up “PZL M-15 Belphegor” on the internet), and there are never clear winners. If one has more range or offers better aftersale support, it may have worse runway performance or higher cabin pressure. On the other hand, there would be no point in this article if we didn’t choose something. So be it. The Legacy 450 is worth looking forward to – if only it delivers on its promises: fly-by-wire, 6000 ft cabin pressure at 13716 m, supermidsize interior space, trademark cavernous baggage compartment and a 1270 kg payload – all at just over $15 million. The problem is, it will only be available from 2014. For a good all-rounder, consider the Learjet 60XR. It is fast, stylish, and flies a long way for its size. Mind, though, that if you want to reach London from Dubai non-stop with this money, the G150 is your only option. It will cost more to operate, but can get you places with its 3130 nm range. As for pre-owned aircraft, it is really down to typical mission. Any model from the Challen-
ger 300 and up can connect Dubai with London, Moscow with most of Asia, and London with New York. If you are looking for even more range, consider the G-IVSP or Falcon 900. The Challenger 850 is for those who crave space and are ready to make an extra fuel stop. The better the performance and cabin, the older the aircraft. As for a good all-rounder, you cannot be blamed for considering an Embraer Legacy 600 – an immensely popular aircraft, and for good reason. Its performance/cabin/ price ratio remains unbeaten. In general, though (and we have said this a couple issues back), it’s a buyer’s market. As Brian Foley puts it, “Prices have generally troughed and begun firming which makes this a great time to purchase. Those who still lack the confidence to buy could consider charter. This would not only meet their interim travel needs, but also afford them the opportunity to fly on a variety of aircraft models before committing to full ownership.” Let’s hope the fears of a double-dip recession do not materialise, and owners of newly-acquired business aircraft ❚ remain happy with their investment.
ALTITUDESARABIA I 61
AA22-54-61-Comparison.indd 61
2/12/12 9:52 AM