Private jet operators court China’s billionaire travellers
With the second largest concentration of billionaires in the world, China is an obvious target for companies in a regional market for private air travel that's estimated to be growing by US$3 billion a year
When a passenger boarded a Zetta Jet in South Africa a couple of years ago, he ordered champagne and caviar. So far, so first-class, right? Except, the frequent flier wanted a specific caviar only available in Europe. So Zetta Jet sent staff to source and fly in the caviar from Geneva. The total tab for caviar alone? US$150,000.
“We can make it happen,” says Geoffrey Cassidy, managing director of the private jet airline which has its headquarts in Singapore. “We do have some weird and wonderful requests, and we go out of our way to do it.”
With a growing number of multimillionaires and billionaires in Asia, Zetta Jet is among the private jet operators in the region who have set their sights on getting these high net-worth individuals on board.
“There isn’t much awareness of private jets in Asia to start with, but it’s picking up. With more education, demand will pick up and the prices will be better,” says Cassidy.
He launched Zetta Jet with fellow aviation professionals James Seagrim and Matthew Walter in August 2015. And since then its fleet of Bombardier Global jets has flown headlining acts into Singapore for its Formula 1 race, as well as VIPs to a Macau casino opening. Clients have included Hollywood celebrities, Silicon Valley executives, oil tycoons, hoteliers and sultans.
Cassidy estimates the airline will do US$25 million worth of business in Asia in the next 12 months. In October alone, eight trips were booked from China to the United States and Europe.
“It’s that flexibility, the security. You understand who’s on the plane with you. Also the privacy. You don’t get someone walking around with no shoes or trying to open emergency doors,” he says.
“Our toughest customers are Chinese female tycoons.”
Getting and controlling the quality of Chinese food in places such as Alaska, for example, is a challenge. “But they’re really quite easily looked after. Once they are comfortable with you, they will enjoy the flight, normally.”
In order to keep clients happy, Zetta Jet maintains a database listing each customer’s profile, preferences and special requests. The airline charges about US$15,000 per hour for their flight charters, for a maximum of 15 people on board. A return flight from Singapore to London, for instance, would cost more than US$300,000.
“We’re definitely keeping our business up in China. We think this area is going to grow,” says Cassidy. “People are sending their children to the US to be educated, and they will come back with the mentality that time is money, this US culture – that you buy a private jet and you can save time. It’s a matter of doing one extra deal a year [with the time you save while flying].”
According to the Wealth-X and UBS Billionaire Census 2014, a survey of the world’s ultra-rich, China is home to the second largest number of billionaires, with 190 billionaires – after the United States, with 571. Asia had 52 new billionaires in 2014, 33 of them from China. The report also predicted that the country would overtake the US for billionaires by 2027. Shanghai-based Hurun Research Institute’s recently released Hurun Rich List disagrees with this figure, citing China as now having 596 billionaires, surpassing the US’ 537.
Jeffrey Lowe, managing director of Asian Sky Group, an Asia-Pacific business aviation services company based in Hong Kong, says: “There were 744 business jets in Asia at the end of 2014. Assuming an average price of US$30 million per aircraft, market size is therefore US$22.3 billion and growing 15 per cent per year. That’s over US$3 billion per year.”
Lowe acknowledges the current political emphasis on austerity in Chinais causing some individuals to re-evaluate any current plans for an aircraft purchase, or at least to purchase outside of China.
However, “the understanding of the private jet as an essential business tool is growing”, he adds, and “the push from the central government for domestic businesses to expand aggressively international” are factors driving greater interest in business jets.
Similarly, Air Charter Service, a global aircraft charter provider with offices in Hong Kong and Beijing, notes that Hong Kong has seen “considerable growth” in private jet ownership and charters.
James Royds-Jones, director of executive jets in ACS’ Hong Kong office, observes, however, that there are concerns specific to Asian private jet operators and users:
“In Asia, there is still a fair amount of paperwork and permissions to fill out and obtain to put a charter together. There is also a longer permit lead time for most countries in Asia, slots into Hong Kong and China are increasingly hard to come by, and there are higher than average airport and handling fees.”
He also cites “parking issues”, as well as how “some Asian countries are still opening up to private jet charter and constantly changing the regulations regarding them”.
Uber-like services or booking apps for private jets, such as London-based Victor and Stratajet, have entered the picture, but Lowe of Asian Sky Group says it may be too early for them to be successful in Asia.
“There is not a huge charter fleet of aircraft available in Asia at the moment,” he explains. “Owners are also unlikely to lend their aircraft or make seats available on the aircraft. Culturally, it is not acceptable at the moment. Give it some time though.”
One way to get around the complexities of private jet ownership or chartering is to simply sign up for a private jet tour.
In October, luxury resort operator Aman and private tour operator Remote Lands ran their first private jet journey together. Over 18 days, 16 guests flew in two Dassault Falcon 2000s to stay at eight Aman properties in China, Bhutan, India and Sri Lanka.
Although we fly together on the jets, once we land at each airport, eight BMWs or Mercedes are lined up so that each of the eight couples have their own private car, driver and guide for transfers as well as touring every day,” says Catherine Heald, Remote Lands’ chief executive, who led the trip. “We offer a much more exclusive and bespoke experience.”
She adds: “Everyone gets to do their own thing on their own time, and that helps a lot. No rules except the timing of the jets.”
The journey cost US$57,750 per person, based on double occupancy. Four more Aman-Remote Lands private jet journeys have been planned: to take place in March and October, 2016 and 2017.
An Asian billionaire and his wife, whom Heald declines to name, have already registered for the March tripwhich will stop in Vietnam, Laos, Cambodia, the Philippines and Japan.
Private Jet Tours, an aggregator of tours by private jets in the world, and VeryFirstTo.com, a website showcasing luxury products and experiences, have teamed up to offer “The Four Jet Tour” – a quartet of travel itineraries, including a round-the-world trip on a custom-designed Four Seasons jet. All four tours, taken in a year, cost £219,404 (HK$2.45 million).
“I have no doubt that an increasing amount of Asians will be drawn to the compelling allure of private jet travel,” says Marcel Knobil, founder of VeryFirstTo.com. “While it has traditionally been seen as a privilege enjoyed by business people, it is now opening up to leisure travellers.”
“There is no better way to travel the globe than by private jet,” he adds. “Privileged access, convenience, time-saving luxuriousness, attentiveness and comfort combine to provide a wonderful experience.”