Sino Jet (SJD, Beijing Capital) is optimistic about the booming business jet charter market in the Greater China region, fuelled by the booming IT, healthcare, and manufacturing sectors, vice chair Jenny Lau told ch-aviation in an exclusive interview. The group, which has double headquarters in Beijing and Hong Kong, continues to see large jets as the cornerstone of the market and is planning global expansion.

"Due to the economic challenges, a lot of the business elites [in Greater China] had very challenging times, and many of them were forced to sell their planes. The whole Greater China region has lost a significant number of private jets in the past two years. However, when we were heading toward mid-2024, we saw a very interesting trend where the IT companies, the new ones, like the online gaming companies, the high-tech young generation, they came up to the market and created a strong demand for the charter business, as well as to purchase brand new aircraft," she said.

With the arrival of new players to the business aviation market, Sino Jet sees a trend towards buying new aircraft to renew the fleet. Owners are, for example, upgrading their G650s to G700s, and their Global 6500s to Global 7500s.

Charter market demand

Sino Jet operates around three-quarters of its aircraft under its Part 91 management certificate, with no charter availability. Jenny stressed that especially among the wealthiest customers in the region, there is still a strong preference for owning aircraft. Likewise, owners of new aircraft are often less willing to avail of them for charter.

However, as the market changes and some legacy sectors of the economy struggle - for example the real estate market - there is now growing demand for charters. Sino Jet owns part of its fleet and is adapting to the changing environment. Jenny said that one of those adjustments is to increase the number of seats available.

"We had to change our strategy. We used to have a Falcon 7X which has only 11 seats, and we were pretty much forced by the market to upgrade to a G550 with more seats so that we can meet the demand. We're also talking to several jet owners so that we can charter their planes out," she said.

As more customers grow comfortable with chartering aircraft, the popularity of shared ownership is also increasing.

Certificate flexibility and global footprint

Sino Jet has two Air Operation Centres in the Greater China region. The Hong Kong operator serves predominantly international customers, while Sino Jet Beijing (JBE, Beijing Capital) is geared more towards Chinese customers. Dual registration is a strong advantage for the group, Jenny said, as it increases its flexibility and allows it to tailor the offer better to the needs of particular owners.

The group also has a growing footprint outside the Greater China region. It already has an AOC in the Cayman Islands and manages multiple aircraft on various global registers, including San Marino, Aruba, the United States, the Cayman Islands, Bermuda, and the Isle of Man.

"For the past few years, we have been focusing on global expansion. We just started our office in Dubai. We have our office in Singapore, in Zurich, and this year we are expanding to North America. We already have staff based there permanently. We're trying to give our Chinese clients, who are global citizens, easier access to managing their aircraft," Jenny said.

She added that Sino Jet aimed to be a "one-stop shop" with in-house charter and aircraft management departments, maintenance shops, and crew training. The group also owns a luxury tour operator, Geostar, which provides additional synergies and opportunities for customers. This ties in with the overall shift towards more leisure charter demand in comparison to the pre-COVID era, when around 80% of all charters were flown purely for business reasons.

There are no plans to pursue any additional certificates, Jenny said, as the current mix of the Cayman certificate and aircraft managed on other registers was working well. Should the newly opened Dubai office grow with more aircraft based in the region, the group will consider an AOC in the UAE.

Sino Jet is optimistic about the prospects for the US market despite the geopolitical tensions. Jenny believes that given the global nature of the aviation business, a "mutually beneficial" solution will continue to exist. At the same time, the ongoing limitations in the number of airline flights between the US and China are a boost to the business aviation segment. "When people travel with more passengers, with their companies, when they want to do some business pitch in the States, it's so much easier for them to just charter a plane to get to their destinations."

Long-range jets in demand

Jenny pointed out that in contrast to Europe and North America, where light and midsize jets are more prevalent, in East Asia and Greater China in particular the market favours long-range aircraft. She said that customers frequently want to travel to Europe or North America, which requires aircraft with global range. At the same time, the high operating costs, particularly related to airport fees and charges, also affect the economics of operations.

"Fixed costs for airport charges are a lot more expensive. If you look at the average per-hour operating cost, the light jet is not that much different from a long-range one," she explained. This is driven mostly by the lack of airport capacity, as large agglomerations in China and Hong Kong do not have business aviation-focused airports.

She added that while there is some demand for light and midsize jets in East Asia, it is limited. Sino Jet would be very careful before taking any such aircraft under management.

"Most of our airplanes are the Global series, the Gulfstream G550 and G650 series, as well as the Falcon 7X, Falcon 8X, BBJs, ACJs. We welcome others, we look into any jet, but if we don't have access to pilots or maintenance engineers, it's just not our speciality, and we would refer to our industry peers who can better take care of that aircraft," she outlined.

For its own fleet, the group is looking for pre-owned aircraft "in great condition and with great value."

"Because we operate globally, we're more interested in the ultra-long-range airplanes, so that the aircraft doesn't limit us to do the charter market only within the region but brings us to the global market, and the margin is better. We like Globals, we're happy to look into any 7X, 8X, Global 6500, Global 7500, or the G650, G700. We want to purchase one or two more and bring into our own fleet," Jenny revealed.