New | HK risks losing out as airport fails to serve executive jet needs, industry warns
Hong Kong’s government will fail to attract more of the world’s business elite to the city if it does not expand airport facilities for private jets, industry executives warn.
“Hong Kong is really its own worst enemy. It is crowded, it’s expensive, and it’s becoming very, very difficult to manoeuvre a business aircraft in and out of Hong Kong,” Mark Thibault, managing director of consultancy T3 Aviation told the South China Morning Post.
“Slots are very difficult to get, and some people are finding refuge for hangar space in nearby airports like Subic Bay (Philippines),” he said.
Industry insiders calculate that about 120 business jets use Hong Kong International Airport (HKIA) as their home base, but that fewer than 70 parking spaces are available at any given time, making it hard for domestic business jets – let alone those of visitors – to secure a spot.
“We get the lowest priority when it comes to slot allocation and parking,” said Charlie Mularski, chairman of the Asian Business Aviation Association and a Hong Kong-based regional vice-president of trip support company Universal Aviation.
“We are seeing clients on roadshows skipping Hong Kong because they find themselves having trouble finding slots and parking space to come in, or [having to] drop off and then relocate somewhere else.”
Slots are very difficult to get, and some people are finding refuge for hangar space in nearby airports like Subic Bay (Philippines)
Executives cite an anecdote of Microsoft founder Bill Gates being refused a parking space for his jet in Hong Kong as typical of the problems faced by their clients who must get permission to park before they get permission to land.
Microsoft declined to comment.
Macau, Taiwan, and the Philippines are the usual alternatives for jet owners to park their planes, but time apart, it doubles the landing, parking and handling bills every time an aircraft touches down in Hong Kong, which adds up to at least HK$35,000 for a large-cabin jet. What’s more, it adds thousands of US dollars in fuel and crewing costs for flying each extra hour.
Hangar space for a Gulfstream G550 jet costs more than US$70,000 a month in Hong Kong compared with US$7,500 in Subic Bay, according to Thibault.
Hong Kong Business Aviation Centre (BAC), 35 per cent owned by Sun Hung Kai Properties, is the airport’s only handler for business jets. It declined to respond to the Post’s inquiries on its capacity and traffic figures because “it is sensitive commercial information”.
The Civil Aviation Department, however, says 9,117 business aircraft movements were recorded at the airport in 2014, representing a tiny 2.3 per cent of total traffic.
Industry executives say more capacity and a second service provider are crucial to keeping business aviation competitive.
But while the business jet lobby may be unhappy, the vast majority of firms that choose Hong Kong as a regional hub for Asia do so because of its commercial airline connectivity.
Premium airlines make the bulk of their income flying executives around the region – and the world – in business or first class seats and have invested heavily in providing the flight connections that give senior managers multiple travel options during the business day.
“We believe immediate short-term measures must be taken to maximise the efficiency and economic benefits of HKIA by prioritising the use of wide-body aircraft for new frequencies,” a Cathay Pacific spokeswoman told the Post.
Cathay and sister airline Dragonair connect around 90 destinations worldwide.
The Airport Authority says its plan to build a third runway will solve a number of capacity constraints faced by the city’s airport – currently the world’s seventh busiest by passenger traffic.
“By expanding the airport into a three-runway system, the airport can serve more flight movements, which can meet the growth of aviation demand,” it said in an emailed response to questions.
The section of the AA website dedicated to persuading the public of the need for the third runway says that business jets accounts for “an insignificant” portion of traffic and would only be allowed ‘residual’ slots. “Business jets are NOT allowed to apply (for) scheduled slots. Commercial airlines have absolute priority over business jets,” the document says.
Industry insiders say capacity problems could be eased if largely idle space belonging to the Government Flying Service (GFS), sited next to BAC, was used. GFS, almost twice as big as BAC, is home to the government unit tasked with emergency operations and has a fleet of 11 aircraft, mostly helicopters.
David Dixon, an industry veteran and president of jet broker Jetcraft in Asia, said the government does not fully appreciate the economic value creation linked to business aviation.
“They think this is a lifestyle business and low on priority. But people who own business aircraft are the people who own businesses, people whom InvestHK is trying to attract. They come here for business – very rarely are these shopping or golfing trips. It is a real shame Hong Kong is waving a big red flag to these people,” Dixon said.
