Wealth Blog | Private jets - an explosive chaotic gold rush

There’s an explosive chaotic gold rush about business aviation at the moment. Manufacturers and management firms are looking at Asia and saying: “Wow this is the market where the action is happening,” says Bjorn Naf, CEO of Metrojet, which manages about a third of Hong Kong’s110 private jets. “I am saying hang on guys, be realistic, you might see the gold nuggets, but there is so much complexity, it is so challenging, that only a few survive.” They are the ones who understand how to navigate the minefield of regulations, limitations, complexity, cultures, countries and know how to get the doors opened to fly. “There are limitations with airspace, parking, hangars. skills- a huge lack of talents – nobody around who knows how to fly, maintain and manage business jets. That’s why I say the growth will happen, but it is not as explosive as people are saying.”

The China Challenge

A big fly in the private jet ointment is China. He sighs. It’s challenging. You need to have your people there and know the lead times. But, he searches for the right tactful words:  “business and private aviation is not as flexible in China as the rest of the world. Some of the beauty of owning a private jet will disappear in Asia. There’s a lot of complexity of running the operation which you don’t have in the US or Europe.” At least a day’s lead time is needed for China, you can’t just say I want to fly to Shanghai, have my aircraft ready to go in two hours.

And there’s no sign of China’s air traffic and other complexities changing any time soon. “It takes years,” says Naf. Hong Kong currently hosts 110 private jets, of which 70 are permanent and the rest transit in and out Aircraft manufacturers forecast market demand for 1,700 new business jets for Asia in the next 10 years –  a new one every three days, US$49billion (HK$380 billion) worth of assets. For all these planes 14,000 professionals – pilots, maintenance crews and flight attendants would be needed.