Mike Walsh, CEO of Hong Kong's Asia Jet, the largest private aircraft seller in Asia, is optimistic about the future of the Chinese aircraft market.
Two years ago there was no private aircraft market at all in China, he said, but he believes that this market will get an increase of 20 to 25 percent each year in the next decade.
This is not just a mirage-like prophecy.
Hainan Airlines bought the first Bombardier Learjet 55 in 1995, which started the market of Chinese business aviation. Since then, the aviation business seemed "dead" in China, only recently reviving. In the last one or two years, aircraft manufacturers received many orders from Chinese mainland enterprises, surpassing the sum of the previous 10 years.
Luxury versus transportation
Private aircrafts are becoming a form of business transportation rather than a luxury. On April 5, Chinese comedian Zhao Benshan spent more than 200 million yuan on a private business aircraft. The plane carried him and his performance team to Taiwan for a promotion activity.
"Private jets are regarded as a kind of luxury because only a few wealthy people can own them," said Yang Xiaonong, the earliest counselor of private aircrafts in China. "But according to requirement, they are used for business mostly."
Yang founded Changsha GALink Aviation Technology Co., Ltd in 2006 which provides purchase consulting and purchase services for enterprises and individual customers.
The main Chinese client base of business aircrafts are the government, the world's top 500 enterprises in China, large Chinese private enterprises and entertainment stars. They are mainly used for foreign affairs, business trips, disaster relief and medical aid.
Will China become the largest private aircraft owner country?
Bombardier Aerospace in Toronto, which started as a snowmobile manufacturer, is now grabbing market shares of Chinese business aircrafts.
With the steady development of the Chinese economy, and low-altitude airspace opened for private aviation, experts think that China's mainland will become the fastest growing region in the next decade. At that time, the Chinese market will need at least 1,200 business aircrafts, and the annual revenues will reach 60 billion yuan.
But restrictive factors still exist. Yang Xiaonong thinks that the private aircraft market in China will not grow rapidly in the short term. The primary problem is the rigid air traffic control. Chinese airspace is controlled so strictly by the army that private aircrafts need to apply for approval level by level, making the flight of private aircrafts complicated.
Tariffs are considered another restricting factor. Many foreign enterprises do not want to register their aircrafts in China because of the high tariffs.
The Chinese administration began to relax the limits on aviation industry. Recently, Chinese civil aviation authorities expressed support for the development of general aviation. At the China Civil Aviation Development Forum held May 12, Li Jiaxiang, director of the Civil Aviation Administration of China, vowed to accelerate the development of general aviation. This shows that China is speeding up the legislative process of Air Law. The draft has been finished, but it is still being studied and finalized.
