China cor­po­rate jet sales ‘dire’ af­ter cor­rup­tion sweep

The China Post - - GUIDE POST -

China’s cor­po­rate jet mar­ket is fac­ing a “dire” 2015, an avi­a­tion con­sul­tancy said, as slow­ing eco­nomic growth and a per­sis­tent crack­down on cor­rup­tion bat­ter sales.

The num­ber of cor­po­rate jets — also called busi­ness or ex­ec­u­tive jets — in main­land China rose 16 per­cent yearon-year to 297 in 2014, in­de­pen­dent con­sul­tancy Asian Sky Group stated in its an­nual fleet re­port.

That was a slow­down from a 26.7 per­cent surge in 2013 and lit­tle im­prove­ment is seen for this year, it added, de­scrib­ing the prospects for Greater China — which in­cludes the main­land, Hong Kong, Ma­cau and Tai­wan — as “dire in­deed.”

The first US Gulf­stream jets only ar- rived in China in 2003, widely seen as the dawn of the new mar­ket.

“The on­go­ing crack­down on cor­rup­tion, I mean it just makes peo­ple sort of put their wal­lets away and think about it,” Asian Sky Group Man­ag­ing Direc­tor Jef­frey Lowe said.

“China is not grow­ing at the same rates as it was, and so the GDP (gross do­mes­tic prod­uct) growth is down as well,” he told a news brief­ing at the Asian Busi­ness Avi­a­tion Con­fer­ence & Ex­hi­bi­tion, be­ing held in Shang­hai this week.

China’s econ­omy ex­panded an an­nual 7.4 per­cent last year, the slow­est in nearly a quar­ter of a cen­tury.

Lim­its on airspace, most of which is con­trolled by the mil­i­tary, have also ham­pered the mar­ket.

Chi­nese Pres­i­dent Xi Jin­ping launched a high-pro­file cam­paign against cor­rup­tion ac­com­pa­nied by a gov­ern­ment aus­ter­ity cam­paign af­ter he came to power more than two years ago.

Some an­a­lysts have been sur­prised by the du­ra­tion of the drive, as pre­vi­ous cam­paigns have tended to wind down af­ter a few high-pro­file cases.

“I think Xi Jin­ping will keep with this for a longer term. Every­body needs to work around that,” Fer­nando Grau, direc­tor of mar­ket­ing and prod­uct strat­egy for ex­ec­u­tive jets for Brazil’s Em­braer in China, told AFP.

Still, cor­po­rate jet mak­ers are bank­ing on grow­ing wealth in China and its com­pa­nies do­ing more busi­ness abroad to drive the mar­ket.

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