China’s business jet market will eclipse sales in the United States, in pure dollar terms, in the next 10 years or so. That’s the prediction of Jason Liao, chairman and CEO of China Business Aviation Group (CBA) and one of the most experienced insiders in China’s business aviation scene. Overall commercial aviation growth year-on-year in China stands at 18%, or twice the annual rate of GDP growth – a stellar number by any measure. This year Liao forecasts deliveries of 70 new business aircraft into China worth about $2.45 billion, and he believes that China’s business jets will roughly double in number each year from now on.
While China’s total fleet is starting from a low point – Liao says there are only about 150 business jets on the mainland today – the local preference for larger, and thus more expensive, aircraft is the key to its future value.
Using this year’s figures as a starting point, Liao reckons that annual growth of 25% from 2011 onward means that China’s business jet market will be worth about $11.68 billion by 2018. In comparison, his U.S. estimate for 2018 stands at $11.26 billion, assuming a national growth rate there of 5% per annum. Liao acknowledges that the 2018 date is not an absolute and admits that he might be off by a few years, but “the trend is clearly there,” and China’s number one position is assured. He points to how demand has already outstripped supply and notes that there is a “huge charter shortage. If you go to an operator like Deer Jet, eight out of 10 times they will tell you that they just don’t have an aircraft available, no matter how much you are willing to pay.
“The OEMs will soon have to increase production for China, especially for large-cabin aircraft,” he says; ”just ask the high-end carmakers – nobody was prepared for China.”
Liao also acknowledges that some restrictions on pilots, official scrutiny and a lack of suitable facilities are causing a near-term problem for growth, but his view is that’s a good problem to have because it will force the issue of development for the future. He also says that a new phenomenon of private airports opening up alongside many newly built state-owned facilities will reshape the way business and general aviation flying is done in China.