Private jet makers look to Asia for growth

Story highlights

  • Most buyers of private jets seek uniform luxury, companies say
  • "It's the cabin that sells the aircraft," one aircraft executive explains
  • Manufacturers will meet clients' demands for interior extras
  • Fears Europe debt crisis will stifle demand for luxury jets

It seems that the global super-rich like their private jets on the bland side.

No matter if you're the CEO of a Fortune 500 company or electronics tycoon from Asia, it's likely a dark wood veneer and light-colored leather upholstery will envelop you in the lap of luxury at 38,000 feet.

Even the bright red and yellow livery of kung-fu superstar Jackie Chan's new jet (that came with his role as "ambassador" for Brazilian plane-maker Embraer), gives way to a spotless interior of mid-tones and cream leather seats.

If it doesn't seem to fit the persona of the martial arts actor, the companies that are fighting over the executive jet market are well aware that giving clients whatever they want, even if that is uniform luxury, is essential when it comes to securing a multi-million dollar sale of an aircraft.

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"It's the cabin that sells the aircraft," says David Velupillai, of Airbus Corporate Jets, from the back of a voluminous sofa on board a champagne-colored ACJ318. "Usually clients just need it to be practical."

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If you can afford a $65 million jet like the ACJ318 (based on the commercial A318), fluctuating fuel costs aren't as much of a concern as a spacious bedroom and enough space for a banquet in the sky.

A round table that can convert into a square for mahjong games is an off-the-shelf option for Velupillai's prospective Chinese clients, who are also being targeted with laser-like precision by the other big corporate jet companies like Boeing Business Jets, Gulfstream, Embraer, Dassault and Bombardier.

Just 15 years ago there was only one corporate jet in China, and private jet ownership was illegal in the country until 2003. Now there are over 200 private and executive jets in China and around 700 in Asia., according to Embraer. However that's a small fraction of the total number of private planes criss-crossing the globe -- Asia still only has about a 5% global share, compared to North America's 40%, the company says.

China's challenge for air supremacy

But while bigger can mean better in the high status world of private jets, the market for smaller four or six-seater jets, accessible to millionaires, not billionaires, is increasing.

Analysts predict that Asia is worth around $40 billion to the private jet market in the next 10 years, although there could be some bumps along the way for companies hoping to cash in on the privacy mores of high-net-worth flyers.

"It's not a recession-proof industry," says Jose Eduardo Costas, vice president of Embraer Executive jets for Asia Pacific.

Like many other businesses, Europe's precarious economic position is the main worry for private jet manufacturers.

"The drivers of this market remain the same; it's how the economies are performing, how the companies are doing, how the stock markets are," says Costas.

"We still have a lot of the bottlenecks (in Asia) that the West has overcome over the last 30 to 40 years -- access to airspace and dedicated infrastructure like private jet terminals and common regulations. They will be smoothed out in time."

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Courting clients and getting them to part with tens or hundreds of millions of dollars is one thing, but dealing with their demands once the plane is in the air is another.

"Every owner is different," says Jenny Lau, CEO of SinoJet that manages six private planes in China, including the Jackie Chan jet. The company is one of many springing up to serve China's private jet owners with air and ground crew.

"Some owners don't want to be bothered at all during a flight, but one might want his ashtray to be cleaned after two cigarettes. One gentleman, for example, if he was to land in Kazakhstan to refuel would expect a blanket to be handed to him, immigration forms to be filled out, that kind of thing."

Lau, a former finance executive from Hong Kong, expects Sinojet to double its client list in the coming year. Her company and others like it are learning to deal with the spontaneous whims of the owners.

That could be having a pilot and stewardess ready to go in a couple of hours for a flight to a different city just for dinner or jetting off for a Big Game hunt in Africa.

"Some are very particular, often about little things like table-wear and having their own and favorite chopsticks."

Demanding, yes, "but they're all very nice!" she adds.