Monday, January 16, 2012

The business of jets

IF you're a business-jet broker, how do you tempt buyers to your office? Steve Varsano, an industry veteran, has put a lot of money into the answer. He has located his new company, the Jet Business, on a highly visible site in one of London’s more moneyed areas, and built a full-size mock-up of the interior of an Airbus A319 in one of the reception rooms.

The Jet Business is an interesting enterprise. Styling itself "the world's first corporate aviation showroom for business jet aircraft", it's a brokerage that links purchasers to planes (mainly second-hand). But it throws a lot more technology at the process than has traditionally been the case. Sitting in front of a 26-ft (8-metre) display screen, Mr Varsano uses a database of the world’s business jets to help clients decide on the craft they need and to work out their availability. The giant screen allows the oligarchs and the potentates to compare, in life size, the cabin dimensions of different planes, look at the seating, and drool over the detailing of the walnut veneers. That’s something you can’t do with PDFs sent by the manufacturer.

The investment in this office is an indication of Mr Varsano's faith in the health of the top end of the business-jet market as the world economy negotiates choppy waters. He admits that the financial crisis has had an effect lower down the market, where people are looking to spend $1m on a jet. But for Mr Varsano there is no recession. He focuses his attention on three types of jet—the super-mid size, the large-cabin and the ultra-long-range—and would-be purchasers of $30m planes are not becoming rarer. “There’s always somebody making money,” says Mr Varsano. “I follow the money.”

Changes to the world economy have had an obvious effect on the nationalities of private-jet buyers. A market that as recently as 15 years ago was dominated by American clients now reflects the rise of the BRICs. Last year 35% of sales of ultra-long-range business jets went to buyers from mainland China.

But wherever the jet-buyers are from, they all eventually come to London. Mr Varsano says the city was an obvious place for him to set up his business because so many rich people pass through. “They have to come through Knightsbridge and they look through the window [of the showroom],” he says. What else is there to do when you're sitting in a chauffeur-driven Bentley waiting for the lights to change on Hyde Park Corner?


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