Chinese business jet firms clutch one another as industry slows

Business jet operators in China are seeking to forge alliances in order to survive what could be the worst year for the country’s slowing business aviation market.

With no major order announcements from aircraft manufacturers at the annual Asia-Pacific business aviation trade show in Shanghai this week, business jet management companies are opting for mergers and acquisitions and other means of consolidation.

NetJets China, the Chinese arm of the business jet company owned by Warren Buffett’s Berkshire Hathaway, said it would introduce mainland conglomerate China Minsheng Investment as a quarter shareholder. China Minsheng already owns Business Aviation Asia, the second largest private jet operator in Asia.

Hong Kong Jet, a HNA Group company, said it would acquire Asia Jet, a Hong Kong-based aircraft charter company. Metrojet, another major player owned by Hong Kong’s Kadoorie Group, announced a mainland Chinese joint venture with Shanghai Junhua Property Company to charter planes on the mainland.

The industry has been in a protracted slide in China as the government’s graft crackdown has held back officials, businesspeople and potential buyers from the market considered too conspicuous. This has resulted in a drop in new plane delivery and an exodus of second-hand planes. The number of business jets based in China, Hong Kong Taiwan and Macau grew just 4 per cent to 300 last year after 38 aircraft left the region, according to consultancy Asian Sky Group, which publishes an annual fleet report.