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Sky's the limit for business aviation (4)

(China Daily)

09:49, May 01, 2013

Cut-throat competition among operators is also forcing down income.

Some industry insiders say the operators are charging 30,000 to 40,000 yuan per hour, just to hold onto business, which experts suggest is unsustainable in such an expensive industry.

Some suggest that consolidation in the industry is inevitable.

"No more than 20 operators will survive in this market," said Gao Yuanyang, director of the General Aviation Industry Research Center at Beihang University.

"Any successful operator needs a fleet of at least 15 aircraft," he added.

As smaller operators struggle under rising costs, the larger ones have been able to focus on the very top end of the market, which continues to grow strongly.

Wu Jingkui, sales and marketing vice president of Cessna Aircraft Company in North Asia, told the CAAC Journal recently that business jets are still considered luxury in China, but that it is important to remember that their use does reduce time costs, and increase work efficiency of top executives.

But industry insiders still consider there is room for the market to grow in China, across all levels of service.

To increase the operational efficiency of their aircraft, some operators have already started offering seats to individual passengers on return charter flights, to bring in some much-needed income.

Wei Yuhang, the manager of the trustee department at Hanhua Airlines, said it now considers offering seats on some fixed routes to paying passengers, if there is room on a plane.

"Business jets can often seat a lot more than just a couple of passengers per fight," added Air Taxi's Ji.

He is preparing to open a new service, too, to raise flight occupancies, which will offer seats on his business jets on regional routes in China.

In the regions the civil aviation authority does not cover, such as Yunnan and Guizhou provinces, business jets with around 15 seats can work as normal commercial operators.

On his new service, Ji said ticket prices will be higher than other larger civil aviation operators, but they will be much lower than chartered flights.

"I like to think of it as a kind of supplementary service for the regional aviation sector," he added.

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Email|Print|Comments(Editor:HuangBeibei、Chen Lidan)

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