NetJets Europe plans NetJets Russia and NetJets India

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Whilst NetJets Inc, the US fractional operator, is focusing on opportunities in China; NetJets Europe is planning to set-up operators in Russia and India.

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Whilst NetJets Inc, the US fractional operator, is focusing on opportunities in China; NetJets Europe is planning to set-up operators in Russia and India.

Both Russia and India feature in a 10 year plan that Eric Connor, CEO and chairman of NetJets Europe, created in 2010.

“Russia has always been important to us and we already do a lot of flying in and out of Russia and India,” says Connor. “Our next step is to fly intra-Russia and intra-India.”

Cabotage rules, which restrict international airlines from carrying passengers inside a country, stop NetJets Europe from being able to carry fractional owners on flights inside Russia or India. Foreign operators can only fly within either country if the flight originates and ends in a foreign country.

Connor says that 90% of business jet flights into Russia involve Moscow and there are big opportunities to sell internal flights to existing Russian customers.

NetJets Europe has not announced a formal date for the launch of either Net Jets Russia or Net Jets India. However, in the 10 year plan, the years 2011 and 2012 were about satisfying customer demand with 2012 and 2013 about new markets. Connor says they will launch in Russia before India. “India is building up and we need to understand the market,” he says.

When NetJets Europe was first launched in 1987 most of its early traffic came from US fractional share owners whom wanted to fly in Europe.  This is likely to be true when the company launches in China, India and Russia.

Russia and India offer significant regulatory challenges. The 1997 Russian Aviation Code restricts foreign ownership of aircraft operating companies to 49%. India has similar ownership restrictions. This means that NetJets Russia will need to have a similar ownership structure to NetJets Europe. Another option for NetJets Europe would be to franchise its brand as it did with NetJets Middle East where the aircraft were owned and operated by Saudi Arabia’s National Air Services. However, NetJets Middle East ended in December 2010.

India and Russia also insist that crew on domestic registered aircraft must all be citizens of their country. However, whilst this may complicate any launch because, of its size it is less on an issue for NetJets than for smaller operators. The company already has extensive experience of training, working with fellow Berkshire Hathaway Company Flight Safety International.

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