April 1, 2013

Private Aircraft Dealerships Popping Up In China

Yet “Buying A Private Aircraft Not As Easy As Purchasing A Car”

China's private jet industry is a blank slate, yet growing pains are inevitable

China’s private jet industry is a blank slate, yet growing pains are inevitable

Over the past decade and a half, the number of private business aircraft operating in mainland China has risen to an estimated 126 (though the actual total is likely higher), with the greatest increase in purchases seen between 2009 and 2011. By the end of 2011, China had an estimated 70 airports and 216 landing points for general aviation, according to a recent CAAC report.

In tandem with rising demand among China’s wealthy for private helicopters and jets, the presence of the world’s top manufacturers has grown rapidly in the country. As John Rosanvallon, President and CEO of Dassault Falcon recently said, “We sold our first new Falcon to China in 2006, but the market has now grown to become our largest for new aircraft orders and our most promising.” Brazil’s Embraer SA, the world’s largest maker of regional jets, expects China to buy 15 percent of its new 61- to 120-seat aircrafts by 2031 as a growing middle class bolsters travel between second-tier cities.

Embraer also expects Chinese demand for business aircrafts to be worth a whopping US$24 billion by 2022, accounting for 9 percent of global deliveries by value. Last June, Embraer was cleared to begin producing its Legacy 650 executive jet in China, reducing the cost and inconvenience of selling planes requiring import licenses.

With demand rising, it’s getting easier by the year for wealthy Chinese to purchase their own helicopters or business jets. This past weekend, Beijing’s first private aircraft dealership opened its doors, attracting quite a bit of attention from gawkers and buyers alike. In all, the dealership sold three planes in its first day.

Via China Daily:

A businessman named Ma from Shandong province, who received his pilot’s license several months ago, bought a 17 million yuan ($2.7 million) helicopter and a 2 million yuan helicopter, China Radio International reported on Sunday.

Wuhan Morning Post reported that it costs at least 200,000 yuan to get a pilot’s license in China.

“If clients buy our aircraft, we can offer free training for them to become licensed pilots,” said Zhang Changyi, manager of the Beijing International United Flight and pilot coach of the store.

While Beijing’s first private jet dealer opened on Friday, Wuhan also opened a store on Saturday.

Liu Xianlu, customer service manager, said besides jet sales the store also provides services such as maintenance, repairs, pilot training, aircraft management and rentals.

On Saturday, three helicopters were ordered by two aviation companies in Hubei and Henan provinces. Each plane cost around 20 million yuan.

Although there clearly is promise in the market, massive obstacles remain before China’s private aviation market truly “takes off.” While the Chinese government is taking steps toward improving the industry by building business craft-specific airports around major cities and cutting the time required for approval of private flights from several days to several hours, as Jing Daily has previously pointed out, “red tape and a dearth of trained pilots, maintenance crews and facilities, and suitable airports continue to smother the nascent industry.”

Aviation / Business & Finance / Investment / Lifestyle / Market Trends / Policy / Travel & Leisure
Tag: beijing, business aviation, business jet, china... , More
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