China Eastern targets corporate jet market
Shanghai-based China Eastern Airlines Corp yesterday said it would invest 50 million yuan (HK$56.98 million) to set up a wholly owned business jet unit to tap the rising number of corporate visitors to the city.
The company did not provide details on its fleet plans, and registration of the unit is still awaiting government approval.
The carrier said corporate jet travel was growing at 20 per cent a year on the mainland, where more than 400 of the world's largest companies have set up joint ventures.
Air China, Hainan Airlines and Shanghai Airlines are also providing business jet services.
Business jets are a smaller class of aircraft designed to provide convenient, often unscheduled transportation for commercial users. Some airlines lease or charter aircraft and provide other services, such as maintenance and terminal facilities.
Usually small- or mid-sized aircraft, they may also be adapted for other uses, such as emergency evacuations, express deliveries, or for use by public bodies, governments or the military.
Consulting firm Frost & Sullivan said some corporations purchased their own jets if their operations were sufficiently profitable although demand for business jets generally lags one to two years behind increases in profit.
French aerospace group Dassault Aviation said it was eying the huge growth potential of the mainland corporate jet market, especially in Beijing, which is easing restrictions on the use of such aircraft.
In 2005, US-based Boeing Business Jets announced it had received its first order from the mainland for corporate jets. In that year, the mainland had a total of 42 business jets, a number which is expected to rise to 300 by 2015.
Frost & Sullivan estimated that revenue from the global business jet market would reach US$22.56 billion next year, from US$18.03 billion in 2006. Gains were driven by orders from rapidly growing countries like China, Russia and India.
Growing market
Corporate jet travel is growing at 20 per cent a year on the mainland
China Eastern is setting up a business jet unit with an investment of, in yuan: yuan50m
