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China is promising new frontier for business jets

WICHITA, Kan. — China may one day be the largest buyer of business jets in the world, eclipsing the U.S. market, a Chinese business aviation expert said this month. Right now, China is not a meaningful part of the business jet industry. Roughly 200 business jets operate in China's vast mainland.

China is expected to eventually take 20 percent of all business jets delivered in the world, up from about 7 percent today, said Rollie Vincent, president of Rolland Vincent and Associates, a market research, analysis and consulting firm.

Planemakers will soon have to increase production for China, especially for large-cabin aircraft, Jason Liao, chairman and CEO of China Business Aviation Group, told Aviation Week this month.

By 2018, Liao told Aviation Week, he thinks China's business jet market will be worth more than $11 billion, roughly the same as the United States.

But it will take time for China to get the systems and infrastructure in place to facilitate business aviation, experts say.

"I do not doubt their resolve," Vincent said.

China's central government has named general aviation as one of the country's pillars of economic development in its 2011-to-2015 plan. The plan includes developing the industry, building a substantial number of airplanes and relaxing its airspace.

China conglomerate AVIC is seeking proposals from business jet makers to set up a final assembly line for aircraft delivered in China and is seeking a foreign partner to co-develop a business jet made in China.

Hawker Beechcraft, Cessna Aircraft and others have answered AVIC's call and are in talks with the Chinese.

Developing China as a long-term strategy makes sense, planemakers say.

China has emerged as a major financial world power with the capital to finance investments internally. The development of its industrial base and natural resources is creating substantial wealth, said Hawker Beechcraft's CEO, Bill Boisture.

"If you look forward in time to a better infrastructure of airports and a more relaxed airspace and a continuing creation of wealth, you have the beginnings of an airplane market," Boisture said.

This month, Beijing set up its first general aviation manufacturing company to launch development, manufacturing, sales and operation in China's capital, the China Daily newspaper said.

Beijing General Aviation Group and Beihang University signed a contract Tuesday and set goals. They will initially invest about $15.7 million in the venture.

China has talked about making a major leap into aviation for the past 30 years, said Richard Aboulafia, aviation analyst for the Teal Group.

"So far, it's just in baby steps," he said. "And that's true of the commercial jetliner side; that's true on the general aviation side."

China is promising new frontier for business jets 11/19/11 [Last modified: Saturday, November 19, 2011 3:31am]
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