As per Corporate Jet Investor, China is ranked ninth in the number of business jets operated in the world as compared with India that is ranked 14th
In recognition of the growing importance of business aviation throughout China and the Asia-Pacific region, top level national officials will meet on April 15 at the Asian Business Aviation Conference & Exhibition (ABACE 2014) for a China Business Aviation Policy symposium. ABACE is acting as a catalyst for the business aviation sector in China specifically. This edition of ABACE has over 150 exhibitors.
In December 2013, Chinese officials eased some mission application and approval requirements for many China-based general aviation (GA) operators. The new policy allows most small GA operations undertaken by Chinese pilots and aircraft to fly throughout the country with only the approval of the Civil Aviation Administration of China (CAAC), rather than undergoing a formal review by the Chinese military.That action follows ongoing consultation with the Chinese Government to open more than a third of the country’s airspace below 13,000 feet to GA operations. Both announcements reflected a pledge by Chinese officials to reform the country’s airspace management system, as well as improve both the allocation and use of airspace resources, as part of the Twelfth Five Year Plan 2012-17.
JOINT VENTURE ROUTE
Along with airspace liberalisation, the Chinese Government is encouraging joint ventures in the sector. “Forming a joint venture has been the quickest path to success for many companies,” noted Jay Mesinger, President and CEO of Mesinger Jet Sales and moderator of the upcoming session. “On one side, you have a regional partner who understands the Asia-Pacific culture, language and relationships, though perhaps they lack the skill set required to manage an aircraft operation. The other half is typically an operator based in the United States or Europe who brings those skills to the table, but is unfamiliar with the nuances of the Asia-Pacific region. Both sides must acknowledge that they need each other.”
Another scheduled topic is the growth of the region’s business aviation infrastructure, as the surge of operations in the region has frequently outpaced the rate of expansion and implementation of needed improvements. The session will also address recent political and economic changes of potential benefit to business aviation operators, including the implementation last year of the first phase of a newly created free trade zone in Shanghai. Other issues to be discussed will include the importance of establishing a strong operational safety culture and methods for the business aviation community to assist government and non-governmental organisations in a regional humanitarian crisis within Asia. Additionally, the session will examine considerations for Asian operators looking to fly into the United States.
Also up for discussion is the cost of purchasing an aircraft. “As is the case worldwide, the Asia-Pacific market for business aircraft is very dynamic,” noted Mesinger. “Supply and demand changes often based on differing priorities and attitudes between buyers and sellers, and strategies must adapt to these factors.” In addition to Mesinger, invited speakers for the event include Jason Liao, China Business Aviation Group; Jeffrey Lowe, Asian Sky Group; Mike Walsh, Asia Jet and Karl Zhao, Wichita Aviation Office of China.
The National Business Aviation Association said it sees the reform as “a good step forward for promoting GA operations in China and throughout the Asia-Pacific region.” “We are pleased that Chinese officials have adopted these regulations specific to general aviation,” said NBAA President Ed Bolen. “This development is the latest in a series of encouraging signs that China is committed to the industry’s growth.”
RELAXING CLOSED REGIME
China and India are two contrasting economies. China is a communist country, while India is founded on socialistic and democratic ideologies. They are both emerging economies, albeit there could be a slowdown presently. Both have started opening up their economies in line with their ideologies and have had their successes. China, however, seems to be ahead in the race and the reasons for that are many.
In general aviation, more specifically business aviation, China has got a lead over India, despite its highly protective environment. The fact that some of the Western airframers have invested heavily in China is indicative of not just the market potential, but China’s approach to foreign investment. That Brazilian aerospace major, Embraer is manufacturing Legacy 650 executive aircraft in China (Harbin) speaks volumes of the Chinese strategy. In India, there is no such programme.
The Central Military Commission approved the Civil Aviation Authority of China’s low-altitude airspace management reform guidance which will gradually open low-altitude airspace across the country’s five aviation control areas by 2015. The move is part of the country’s plans to boost China’s general aviation market, which is waiting to explode. This move, however, may not benefit business jets such as the Gulfstream G650 as these aircraft operate at much higher levels, going up to 51,000 feet. Low-altitude airspace is airspace that does not affect public air transportation lines and is typically below 3,000 metres. China classifies such airspace as below 1,000 metres, while airspace set for GA is set at above 6,000 metres. About 80 per cent of China’s airspace is said to be controlled by the military.
The opening of the airspace will mean general and business aviation aircraft will be able to take off and operate without approval. Under previous regulations on the airspace, GA and private aircraft had to apply in advance for permission for each flight which invariably took longer for approvals, thus hampering the growth of the GA segment. However, demand for helicopters and light aircraft has been booming in recent years. As per Corporate Jet Investor, China is ranked ninth in the number of business jets operated in the world as compared with India that is ranked 14th.
LARGE CABIN FLEETS TRENDING IN CHINA
According to Asian Sky Group, the fleet of business jets in Greater China was 336 in 2012 with 57 per cent based in China and 33 per cent based in Hong Kong. The fleet is dominated by two manufacturers: Gulfstream and Bombardier with a total of 219 aircraft, representing 65 per cent of the fleet. By category and unsurprisingly, the Greater China fleet consists of predominately large cabin business jets and bigger – including super large, ultra long range and corporate airliners. These four categories include 70 per cent of the fleet and are split evenly between the China and Hong Kong markets.
The Greater China business jet fleet grew by 96 aircraft throughout 2012, a 40 per cent growth rate. Gulfstream added the most aircraft: 36 in total comprising 22 G550s and 12 G450s. Bombardier added the second most: 25 in total consisting mostly of 605s (13 605s – 22 combined Challenger types) and Globals (nine combined model types).
Along with business jet manufacturers, airports and airlines are also starting to see the potential in the country’s business aviation market. The Shanghai Airports Authority opened the country’s first business-aviation service base at the Shanghai Honggiao International airport. The authority expects the number of business aircraft take-offs and landings to increase 10-15 per cent in the near future from the current 2,000 take-offs and landings per annum at Honggiao and Pudong airports.