Leck Chet Lam, managing director of Experia Events, and Paul Desgrosseilliers, general manager of ExecuJet Haite, speak with BCA’s Molly McMillin about the growing business aviation industry in Asia, its challenges and opportunities during the first Business Aviation Asia Forum & Expo, or BAFFEx, at the Changi Exhibition Centre in Singapore.
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Transcript
Molly McMillin: Hello and welcome to today's BCA Podcast, focused on business aviation in Asia. I'm in Singapore today at Changi Exhibition Centre for the very first Business Aviation Asia Forum and Expo, or BAAFEx.
With me today are Leck Chet Lam, Managing Director of Experia Events, the organizer of the show, and Paul Desgrosseilliers, general manager of ExecuJet Haite, based in Tianjin, China. Together, they will will discuss Asia's business aviation industry and what they're seeing in the market, the challenges and opportunities, and also a little bit about the show. So, welcome. Thank you.
Leck Chet Lam: Thank you. Thank you for inviting us.
Paul Desgrossei...:Thanks for having us, Molly.
Molly McMillin: Let's start with you, Chet. Before we talk a little bit about the market, let's talk about news of the show. And this will now be held every two years, the office at the Singapore Air Show. And the floor seemed very busy this week with 50 exhibitors and three long-range jets on static display.
You had mentioned about 2,500 attendees have come through the doors here, so it's been a busy three days. And I also noticed you had standing room only at the conference sessions. What do you think, why was this the right time to launch this kind of show?
Leck Chet Lam: Well, I think this part of the world in Asia-Pacific, we have been had the vacuum since 2019 for a dedicated business aviation event. So, I think we are past COVID, the economies are recovering. I think that's why Experia Events really looked at this and said that this is the best time, opportune time to launch such a dedicated business event.
And now, of course, we launched it here in Singapore, and thus far over the last three days, we have been walking the floor. And the feedback we have gotten was that yes, this is a show that they've been looking for, it'll be waiting for. So I think, yeah, that's right. Here we are in BAAFEx 2025.
Molly McMillin: And it's going to be back two years from now, you mentioned.
Leck Chet Lam:Yes, it's going to be once every two years in odd years.
Molly McMillin: All right, so let's start with you, Paul. What's the future of business aviation in Asia? You're in Tianjin and then you also just opened a facility in Beijing. So why, what's the market like here?
Paul Desgrossei... Yeah, so I think it's an exciting time, particularly in Southeast Asia where we are today. If you look at Singapore, Singapore is really a hub of business aviation and has been. It's one of the more developed markets in this part of the world.
I think some of the early investments that happened in business aviation somewhat 30 years ago, and it's grown, and it's grown tremendously, particularly in the last 10 years. Several of the OEMs have made major investments in Singapore.
If you're looking at the fleet growth in Singapore alone, it's grown 15%. It's one of the fastest growing countries in the region, going from I think 72 aircraft to 83 aircraft today. And I remember ... I've been in this part of the world now some 16 years ... I can remember when there were only three or four aircraft, three or four business jets based in Singapore 15 years ago. Now we're talking about 80 plus.
So, I've seen the tremendous growth, not only in Singapore, where we are today, but also in region. And I've seen the ebbs and flow and the tremendous growth we saw in China in 2008, coming out of the Olympic games, and the opening in the country and then the explosive growth we saw for maybe five or six years. And that was always going to tail off as it matured. And unfortunately, we saw a little bit of a downturn, but we've seen stabilization in markets like Hong Kong now where we actually grew the fleet one business jet. But after many years of significant declines, it's great to see at least a stabilization. So, we're looking to have some stabilization in mainland China.
My business in itself, the MRO market, the maintenance market, both in, say, northern China, and you can see the growth here in Singapore at some of the MRO facilities here. But I think across the region we're seeing increased demand for MRO. It's going to be over 4%, which is 1% more than what we see in the U.S. or in Europe. So, the demand in Asia, not only for some business jet and fleet growth and what we'll see in terms of deliveries, but also now for the ancillary services, for maintenance services, that growth's higher in this part of the world versus some of the more mature markets.
So, I think we're really seeing growth in our industry across the board throughout the region. And we're going to look for this to continue.
Molly McMillin: And Chet, you had some figures, I think, from Aviation Week and Asia Sky Group about looking forward. What do you think is the potential is for this area?
Leck Chet Lam: I think the data from Aviation Week, I think all shows there'll be growth in Asia Pacific region, but I think the important fact is that is the rate of growth is going to be higher than the average global.
So, for example, the fleet size, I think Asia Pacific is going to grow at 2.1 and then the rest of the world is at 1.4. I think that's really almost a one percentage growth advantage in Asia Pacific. And what Paul mentioned, MRO, if I remember the numbers rightly, the MRO growth rate in Asia Pacific is like 4.1 and the rest of the world is like 3. So again, it's almost more than one percentage point.
I think the growth is there, but more importantly is the growth rate. So, I think we're going to see going to be a very vibrant Asia Pacific market, and it's not just MRO like Paul said. Then it's going to cascade down to the rest. You're going to be training pilots, engineers, technicians. So, I think that goes, the value chains will start to grow, and I think it's good for the industry in this part of the world.
Molly McMillin: Every part of the world has its own challenges. And I'll start with you Chet, and then Paul. What are the biggest ones for this market? And I know there are so many regions within Asia and Asia Pacific, but what do you see as your main challenge?
Leck Chet Lam:I would say two main challenges. Regulatory framework across various countries, across various jurisdictions, across various authorities. And the other one is the development of infrastructure to keep pace with the growth, whether is it airport infrastructure, whether is it supporting infrastructure, FBOs. I think things like that. So, these are the two things. I think these are the two key challenges. Just have to keep pace so that we can continue to support the growth, the forecasted growth.
Molly McMillin: And Paul, what do you say?
Paul Desgrossei...:Yeah, I think Chet's exactly right. And really, it's the different markets. Southeast Asia is more developing. My part of the world, being up in Northern Asia, it's more mature. For us, business aviation's been around 15, 20 years.
When we look at some of the issues in Southeast Asia, excluding Singapore. Singapore is a developed market. But if we look outside of Singapore, whether that's Thailand, whether that's Indonesia, Vietnam, Laos, there's business jets in all these countries now, and business jets in larger and growing numbers. So, there is just a lot of challenges with infrastructure and regulatory framework dealing with the governments. And we have issues with advocacy and just getting the message and the importance of what business aviation could deliver to the local or the regional governments. So this is the issue in Southeast Asia.
Now, taking a step back from where I'm based in Beijing and China, it's a different set of issues. Right now, we're dealing with a bit of a market downturn, but there's been a lot of issues, and certainly COVID exacerbated some of the fleet decline numbers. But like I said, Hong Kong has stabilized. I think it's a bellwether of what's to come in China. And hopefully we can start seeing fleet growth again. If we look at very country-specific numbers, China is still the largest market, the largest individual country market. There's some, inclusive of Hong Kong, there's 305 business jets in China alone. So it's still a huge market, and with that market brings great opportunity. So even with some of the declines we've seen, we still have this huge potential in China.
I think we look for 2025-6 of stabilization, future growth. There are still new aircraft being delivered into China. We have one coming up north very soon, next month, brand new aircraft. We have the delivery scheduled for later this year, some of the larger and brand-new OEM aircraft coming into China.
It's not that all the aircraft are leaving, it's just right now we have more leaving than coming in, but we still have them coming in. So it's still a very large market.
Now if we look at the different, whether it's OEMs, whether it's operators, and all of these services, like my own company, MRO, we see a lot of engagement in the Chinese business aviation community. I also sit on the board of directors for the Asian Business Aviation Association. I see what happens on a regional basis, and the engagement in China exceeds, I think, all the other chapters almost combined. We have just tremendous engagement. The community in China is, everybody's looking forward to the future. They're very experienced now being in the industry for the last 15 years, and everybody's engaged for that future growth. But they stay engaged. They stay committed to the market.
We continue to spread the message in China, and the government does support it. This is one of the questions I always get asked about the Chinese market. "Does the government support it?" And one of the things that I use as an example for my own facility in Beijing, when Beijing built a new airport, and this has been ongoing in plan for 10 years, and it started operating a few years ago for domestic traffic during COVID, and now it's really spooling up and they're handling a tremendous amount of passengers. And so this was the second airport. Now in Beijing. It's Beijing Daxing Airport.
But the government allocated 300,000 square meters of space for business aviation, exclusive for general and business aviation. They built five aircraft hangars and an enormous VIP terminal that can handle the largest of government charters, both international government charters, domestic government charters. It can process upwards of 300 or 400 people at a time through the FBO channels. And then it's got a regular domestic and international channel. It can park over a hundred business aircraft, business jet aircraft. And then it has my maintenance facility there, which is a well-recognized international standard MRO to serve the international transient fleet and the domestic Chinese fleet.
But the government built this infrastructure. It secured this plot of land and went forward with this from the construction started in 2019 onwards. So, it shows a commitment. This sort of investment doesn't take place without the Chinese government support, because this is all central government driven through Capital Airport holdings. So, the government does support business aviation. This shows that it supports it, so it wants it to grow. So we just see the stabilization, but there's so much potential in the Chinese market, and I think we're going to start seeing some of that potential come to fruition 2026 and beyond.
Molly McMillin: And Chet, what are you expecting for the show in two years?
Leck Chet Lam:Definitely it's going to be a bigger show, and Paul is coming back for the 2027 edition. And yeah, we just want to attract a bigger value chain in terms of reach, in terms of breadth, in terms of depth, so that it brings value for the attendees to the show, be an exhibitor or be the attendees or trade visitors. So really want to grow the show, the size, the scale, so they can be more reflective of more sectors of the ecosystem to be represented at the show. And of course, we want to also work towards a bigger static display segment for the show, too.
Molly McMillin: Any final thoughts for either one of you. Paul?
Paul Desgrossei...:Yeah, look, I think we're committed to being here again in two years. I think we're going to have some discussions this afternoon about that commitment.
When I talk to the members of our association, and that's 130 companies we represent to the Business Aviation Association, everybody is excited with what we've seen here. It's the first air show in Singapore. We used to have a very similar air show in China, but it hasn't happened since pre-COVID. So I think getting the aviation community, the business aviation community, which is a very strong community here in Asia, getting everybody together, everybody sees the potential of this show going forward.
I think we're going to see a much larger show in two years’ time, more OEM participation, which will be key to that, which will drive other companies like myself. But we're committed to being here. I think many of the Chinese exhibitors that have already been here this time around are looking forward to the next time as well. So, I think this show is really going to grow as some of the previous shows did, and we look forward to being here again in two years’ time.
Molly McMillin: All right. Well, that's all the time we have for today. Thank you both for being here.
Leck Chet Lam: Thank you.
Molly McMillin: Thank you all for listening, and please join us for the next BCA podcast.
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