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Operating Environment in China Gradually Improving

October 31, 2012

While flying to and within China still can be challenging, operators, regulators and service providers that met on Oct. 30 at NBAA2012 agreed that improvements in the operating environment are occurring, albeit slowly.

During a session titled “Operating and Doing Business in China – a Continuing Dialogue,” flight department managers whose aircraft frequently fly to China compared notes with service providers and other country experts. Two members of NBAA's Board, Jeff Lee of American Express Company and Jay Mesinger of J. Mesinger Corporate Jet Sales, Inc., moderated the discussion.

Attendees at ABACE2012From a regulatory perspective, one of biggest issues for business aviation in China continues to be infrastructure, said Robyn Cicero, the Federal Aviation Administration’s foreign affairs specialist for Asia. All large airports are constrained, but the Civil Aviation Administration of China realizes that it needs to build dedicated business aviation airports, as well as more regional airports. However, progress, both in infrastructure development and the opening of airspace, will proceed at a measured pace, Cicero predicted.

Roger Whyte, Cessna’s former senior vice president of sales who has extensive experience in China, agreed, saying progress will be “gradual.” Whyte reported that between 60 and 70 business aircraft were introduced into China last year and the business aircraft fleet there has grown to approximately 270.

From an operating standpoint, Whyte said that the need for permits and the considerable costs of flying in China still hamper access. He also noted that China suffers from a shortage of aviation personnel, which presents an opportunity for training organizations. In fact, he said there are “enormous possibilities” for all types of aircraft product and service providers.

However, he warned, “If you want to do business in China, you need a great deal of patience. Relationships are paramount.”

Several U.S.-based flight department managers reported that demand for flights to China is increasing. Rich Walsh, director of a U.S. multinational corporation, said requests for travel there are coming with less notice. He used to learn of travel requirements 30 to 60 days in advance. Now requests come in as little as three to five days before a trip, which sometimes can be challenging.

Mike Wilkinson, chief pilot for another U.S. operator, said his company has decided to base an aircraft in Hong Kong to meet travel needs, using a local management company to conduct operations. Derek Green, another flight department manager, has formed partnerships with companies in the region and purchased block hours of charter.

Overall, improvements in Chinese operations seem to be occurring as U.S. operators familiarize themselves with local companies’ capabilities and service providers work to meet customer expectations.

Challenges remain, however. Chris Buchholtz, general manager of Hong Kong Jet, said few Chinese-registered aircraft are available for charter, and service sometimes is not up to international standards. Airspace restrictions can be vexing, operating costs high and there is a shortage of experienced pilots. Both Buchholtz and ARGUS President Joe Moeggenberg said local operators need to fully embrace safety management systems.

Bombardier’s Lanny Schindelmeiser underscored the need for manufacturers to invest in China, putting people and parts in place and supporting the training of Chinese nationals.

NBAA President and CEO Ed Bolen sees the Asian Business Aviation Conference & Exhibition (ABACE) as an investment in business aviation. Bolen said NBAA’s goal with ABACE “is not just to put buyers and sellers together, but to promote education, information sharing, safety and professionalism.” The show also is an opportunity to acquaint the media and government officials in the region with business aviation, he added.

The next ABACE – which will be presented in partnership with the Shanghai Airport Authority and co-hosted by NBAA, the Asian Business Aviation Association and the Shanghai Exhibition Center – will take place April 16 to 18, 2013, in Shanghai. Visit the ABACE2012 site at www.abace.aero.