The jets and the sharks
Private aircraft allow mainland business people to get the job done efficiently, but also with a sense of Chinese style, writes Tiffany Ap
President Xi Jinping's anti-corruption drive may have taken a substantial toll on the sales of luxury cars, watches, jewellery and liquor by government officials, but private aviation has dodged the crackdown. What's more, the latest forecast from Bombardier, a Canadian company that makes jets for the well-to-do, projects 2,420 business jets will be delivered on the mainland in the next 20 years - 1,000 of them in the next decade.
"[Orders haven't dropped] as much as one might have thought. Our prediction is that there will be substantial purchases this year," said Wealth-X CEO Mykolas Rambus, as the anti-graft push is mostly against wealth the public can see.
When it comes to privately owned private jets on the mainland, living large means exactly that.
"They are really focused on the large cabin aircraft, the large business jets, the ones that have an ultra-long range, intercontinental range," said Felicia Knippa, a designer of plane interiors. "It really suits the Chinese way of doing business. You could be eating dinner, playing cards, doing karaoke. They like to travel in larger groups."
Bjorn Naf, Metrojet CEO, adds: "As a general rule, Chinese business jet buyers tend to opt for mid-sized to large, long-range to ultra-long range aircraft."
With the rise of new mainland wealth, tables for chess or checkers on planes gave way to mahjong tables. "What was neat was the appearance of red," Knippa said. "Westerners are very shy with colours, and red was more or less a no-no inside an aircraft. And of course the integration of special symbols. Karaoke machines and mahjong tables, that was a novelty."
But the Chinese tend to want delivery as soon as possible, Naf said, so rather than opt for time-consuming customisations, "they often settle with the standard configurations offered by the original equipment manufacturers, but with their own choice of fabric, veneer and colour scheme."
Another point: Chinese don't like to buy used aircraft. US owners might charter out the plane to bring in income when they're not using it. Not on the mainland. "The idea of sharing just doesn't go over," said Rambus. "If you can't afford to own it yourself, then just don't buy it."
Mainland owners, like many of their elite peers worldwide, see private planes as an indispensable part of doing business. Rich people there are younger on average than their Western counterparts, meaning they're more active. On top of that, Chinese businessmen tend to extend their careers. Take Hong Kong tycoons Li Ka-shing, Lee Shau-kee and Lui Che-woo, for example. All are well into their 80s.
"[The Chinese elite] don't get to 55 or 60 and say: 'OK, great, I'm going to go ride around on a yacht all day. They're looking at a longer term, if not indefinite, period of activity of business," said Mykolas.
At the same time, the wealthy in China are also seeking diverse, liquid investments.
Rambus says banks "will almost all tell you that individuals are chasing that liquidity: how they find ways to pour their capital into things that will give them liquidity and or hedge their risk so they're not 100 per cent exposed to the mainland. That's a big concern as things are shifting at home."
Private jets can facilitate that, because they let owners fly round the world to look at investments.
Thomas Flohr, founder of Vistajet, which leases private jets, says travelling on private jets also cuts out pre-boarding, luggage collection and immigration queues, saving up to three hours.
"They also have direct access to destinations that are underserved by commercial airlines or may take two or even three flight connections to reach," Flohr said. "Point-to-point travel to the most remote areas of the world is a huge time saver."