Business jet manufacturers are beginning to see some green shoots and expect China to be an important driver in the recovery of corporate aircraft sales in Asia.
Despite the economic downturn, Hong Kong-based David Dixon, Bombardier vice-president for sales, says prospects for business jets have probably never been better and China, Hong Kong, Macau and Taiwan could embark on another growth spurt.
"The economic crisis in Asia is different as the ability to lend and borrow was not as badly affected as it was in North America and Europe. The financial institutions here were not in as much trouble, and so the business aviation market has not followed the market in North America," he says.
"The interest in business jets has come back and come back very quickly over here. The level of interest is high. That is a very good sign."
Airbus believes that a change in attitude towards the ownership of business jets in China will see a major growth in orders, particularly in the area of larger cabins, says Francois Chazelle, head of Airbus's executive and private aviation division.
Asia Pacific's share of the airliner sector is forecast to reach 30% and Chazelle says that executive aircraft could do the same.
He points out that China is coming from virtually a standing start. "A few years back people didn't own houses, let alone business jets. It wasn't culturally or politically acceptable. There is now a big change and the Chinese government recognises the role these aircraft play as a corporate tool.
"There is a clear direction from central government to develop business aviation as a means to develop the economy. As more wealth is created and demand rises, so does the need for business aircraft."
Traditionally, the demand for the airliner or large-cabin aircraft comes from customers moving up from smaller jets. Experience in Russia showed Airbus that this could be different.
"Because it is a new market we find some owners will go straight to an Airbus Corporate Jet," Chazelle says. "Culturally, we think that there is more of a demand for new aircraft rather than used aircraft."
Bombardier's Dixon concurs that the perception of China as being a tough market for business jets is changing. From only a handful of airports being open to business jets almost a decade ago, about 150 of the country's 400 airports are now accessible to all business jets and many are near the major cities.
It once took about a week to obtain permission for foreign-registered aircraft to fly to China. Now, the owners need only provide additional information for checks the first time the aircraft flies into the country. For subsequent trips, permits are usually issued within a day, says Dixon.
Embraer has been trying to build on its existing operations in China to boost sales.
"We are affected by the economic crisis because the whole business jet market shrank, making it difficult for aircraft sales, However, this also is a time when customers are seeking aircraft with value for money, lower operating cost and better customer support," the company says.
Asia will continue to be a key segment for Gulfstream, which plans to have field representatives in China and Japan in the coming months in addition to existing personnel in Hong Kong, Singapore and India. It is also pushing to increase the availability of after-sales service centres and the spares stockpile in the region.
"We have invested substantial amounts of time and money into services spare parts over the past 10 years in the region, and we are seeing the benefits with increased sales around here," says Roger Sperry, Gulfstream's vice-president international sales. "We are particularly interested in Asia and we see our presence growing in the coming years," he adds.
Meanwhile, fast-growing on-demand/block charter operator VistaJet teamed with Bombardier to offer demonstration flights on two of its models during the show - a brand-new Challenger 605 and a larger 850.
VistaJet has seen demand in the Asian region pick up substantially from April following a tough start to the year, says founder, owner and chairman Thomas Flohr.
The company, whose principal rival NetJets does not have a presence in Asia, is on track to achieve 15% growth in the region for the full year.
"With the general economic climate picking up, especially in Hong Kong, Macau and mainland China, we are very happy to have the opportunity to show our aircraft," says Flohr.
Source: Flight International
