The GREATER CHINA BUSINESS JET FLEET 2 the GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 TABLE of CONTENTS

The GREATER CHINA BUSINESS JET FLEET 2 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 TABLE OF CONTENTS

3 SUMMARY

4 GREATER CHINA FLEET

15 PEOPLE’S REPUBLIC OF CHINA (PRC) FLEET

26 PRC BUSINESS JET MARKET

34 GREATER CHINA BUSINESS JET MARKET – BY OEM

Asian Sky Group would like to graciously acknowledge the contributions made by numerous operators, OEMs and organizations to this report, without which a reasonable level of accuracy could not have been achieved.

The report is nevertheless the first of its type and undoubtedly there will be perceived errors. Asian Sky Group welcomes your comments & criticisms and looks forward to producing an even better 2nd version of the report in the future.

For the purpose of this report, Greater China includes the PRC, ROC (Taiwan), HKG and Macau.

Asian Sky Group Ltd. (ASG) is pleased to present its Greater China Business Jet Fleet Report for Year End 2012. The information contained in this report is provided free of charge for discussion purposes. ASG is not responsible for, and expressly disclaims any & all liability for damages of any kind arising out of use, reference to, or reliance on any information contained within this report. While such information was compiled using the best available data as of January 2013, no guarantee is given that it is correct, complete, and up-to-date. ASG does not represent or mean to be associated in any way or form with any operator or company presented in this report.

Should you wish to reproduce or distribute any portion of this report, in part or in full, you may do so by mentioning the source as: “Asian Sky Group, a Hong Kong based business aviation consulting group”.

Thank you for your interest, we hope you appreciate the information. Do not hesitate to visit us at www.asianskygroup.com or contact us at [email protected] if you would like to receive further information about our services.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 1 Asian Sky Group (ASG), headquartered in Hong Kong + with offices throughout China, provides its clients with consulting services including aircraft selection, technical, contractual & operational guidance, aircraft ownership options & structuring: fair market & residual value appraisals, production management, and aircraft outfitting services.

Established in March 2012 to tap into the growing market demand for private and general aviation aircraft in the Asia Pacific region, ASG employs some of the most experienced aviation professionals in Asia.

ASG is a provider of aircraft sales and acquisition services for both fixed and rotary aircraft to a range of corporate, high net worth and government clients across the Asia Pacific region, and with a significant focus on the Greater China region.

ASG utilises exclusive partnership agreements to provide access to a significant customer base around the world. These include Avpro Inc., the largest business jet brokerage firm in the US, and AVIC Int’l Development Corporation, the largest state-owned aviation enterprise in mainland China.

ASG is backed by SEACOR Holdings Inc., a publically listed US company (NYSE: “CKH”) with US$2 billion in revenue and US$4 billion in assets, and Avion Pacific Limited, a mainland China based provider of general aviation services with 20 years’ experience and 7 offices & bases throughout mainland China. ASG is designed to capitalise on both companies’ considerable investments and business development initiatives in the Asia Pacific region.

www.asianskygroup.com

2 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 SUMMARY

The fleet of business jets in Greater China numbers 336 at the end of 2012 with 57% based in China and 33% based in Hong Kong.

The fleet is dominated by 2 manufacturers: Gulfstream and Bombardier with a total of 219 aircraft, representing 65% of the fleet.

By category and unsurprisingly, the Greater China fleet consists of predominately Large Cabin business jets and bigger – including Super Large, Ultra Long Range and Corporate Airliners. These 4 categories include 70% of the fleet, and are split evenly between the China and Hong Kong markets.

The Corporate Airliner segment is led by Airbus with 18 aircraft or a 58% market share.

The undisputed King and Queen of the Ultra Long Range and Super Large segments are Gulfstream’s G550 and G450 with 63% (55 aircraft) and 62% (33 aircraft) market share respectively.

The Large Cabin segment is dominated by Bombardier with its Challenger product line and particularly the Challenger 605 with a 38% market share.

The majority of the Super Mid-Size and smaller business jets – including Mid-Size, Super Light, Light and VLJ – are based in China where they serve the domestic market.

The Super Mid-Size market is dominated by Gulfstream’s G200 (61% market share); the Mid-Size market by Hawker (68% market share); and the Super-Light, Light and VLJ by Cessna (92% market share in these combined categories).

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 3 FLEET BREAKDOWN BY OEM – GREATER CHINA

Gulfstream Cessna Hawker 122 33 27

Embraer 8

Airbus 18

Boeing 336 Aircraft In Total 11

Falcon Bombardier 20 97

4 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 MARKET SHARE BY REGION

ROC 3%

Macau 5%

PRC 57% HKG 33%

OEM MARKET SHARE – GREATER CHINA

Gulfstream 36% Cessna 10% Hawker 8%

Embraer 3% Airbus 5% Boeing 3%

Falcon 6% Bombardier 29%

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 5 GREATER CHINA FLEET – BY CATEGORY

ULTRA LR 26% CORP A/L 9% VLJ 1 A/C LIGHT 6%

S-LITE 5%

MID 8%

S-MID 11% 70% of the Fleet Large Cabin & Bigger

LARGE 19% S-LARGE 16%

GREATER CHINA FLEET REGIONAL MARKET SHARE BY CATEGORY

HK Base PRC Base Macau Base 94% 84%

68% 68% 55% 50% 49% 49% 45% 43% 32% 34% 33% 21%

4% 6% 5% Corp. Airliners Ultra Long Super Large Large Super Mid- Mid-Size Super Light Light Range Size Figures for Taiwan and Macau (except for Mid-Size) are not shown.

6 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 CORP. AIRLINER FLEET – GREATER CHINA 31 A/C, 9% OF FLEET

10 9

2 2 1 1

L1000 A319 VIP ACJ318 ACJ319 ACJ330 BBJ BBJ2

Airbus Products 58% Share

ULTRA LONG RANGE FLEET GREATER CHINA 88 A/C, 26% OF FLEET

55 Gulfstream G550 63% Share

9 11 7 2 4

GLOBAL GL-XRS G6000 F7X GV G550

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 7 SUPER LARGE FLEET – GREATER CHINA 53 A/C, 16% OF FLEET

33 Gulfstream G450 62% Share

10 6 2 2

G5000 F900DX/EX F900LX GIV/SP G450

LARGE FLEET – GREATER CHINA 64 A/C, 19% OF FLEET

24 Challenger 605 38% Share

9 10 5 5 3 2 2 1 2 1

L600 L650 CL601 CL604 CL605 CL800 CL850 CL870 F2000 G300 F2000LX Challenger Product Line 81% Market Share

8 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 SUPER MID-SIZE FLEET – GREATER CHINA 36 A/C, 11% OF FLEET

22 Gulfstream G200 61% Share

8 5 1

Cit X H4000 CL300 G200

MID-SIZE FLEET – GREATER CHINA 28 A/C, 8% OF FLEET

Hawker Product Line 68% Share 9

4 4 4

Sovereign H750 H800/850 H900/XP L60/60XR Astra/G100

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 9 SUPER-LIGHT FLEET – GREATER CHINA 16 A/C, 5% OF FLEET

6 5

1 1

Cit VI C525 Excel XLS/XLS+ L35/36

LIGHT FLEET – GREATER CHINA 19 A/C, 6% OF FLEET

4 3 2

Cit ll CJ1/1+ CJ3 H400/XP

10 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 GREATER CHINA FLEET – GROWTH IN 2012 SUMMARY

The Greater China business jet fleet grew by 96 aircraft throughout 2012 – a 40% growth rate.

91% of the increase was in the Large, Super-Large, Ultra Long Range and Corporate Airliner categories.

Gulfstream added the most aircraft: 36 in total comprising 22 G550s and 12 G450s.

Bombardier added the second most: 25 in total consisting mostly of 605s (13 605s – 22 combined Challenger types) and Globals (9 combined model types).

There were some fleet removals through the year 2012, these being older model types like 604s, F2000s, GIVs and GVs.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 11 BUSINESS JET FLEET – GREATER CHINA Growth 40% 400 96 aircraft 350 336

300

250 240

200

150

100

0 2011 2012

GROWTH PER SEGMENT 2011 TO 2012

Yr End 2011 Yr End 2012

Large, S-Large, Ultra LR & Corp A/Ls Added 87 Aircraft in 2012 or 91% of Growth

64 53 53 44 36 39 28 28 30 31 18 19 14 16 13 1 1 VU LIGHT S-LITH MID S-MID LARGE S-LARGE ULTRALRCORP A/L

12 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 NET NO. AIRCRAFT ADDED TO THE GREATER CHINA FLEET IN 2012

Gulfstream 36 Falcon 9 Bombardier 25 Boeing 5 Alrbus 11 Embraer 7 Hawker 3 Cessna 0 0 5 10 15 20 25 30 35 40

AIRCRAFT TYPES ADDED – GREATER CHINA

13 12 7 7 5 4 5 4 4 2 2 3 2 2 2 2 2 2 1 1 1 1 1 1 1 1 CJ3 BBJ F7X Excel BBJ2 L650 C525 G200 G450 G550 L1000 CL300 CL605 CL800 CL850 H4000 GL-XRS G5000 G6000 ACJ319 ACJ318 ACJ330 F900LX GLOBAL A319VIP F2000LX H900/XP

AIRCRAFT REMOVALS – GREATER CHINA

Sovereign Cit X CL604 F2000 GIV/SP GV

-1 -1 -1 -1

-2

-3

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 13 14 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 PEOPLE’S REPUBLIC OF CHINA (PRC) FLEET GROWTH IN 2012 SUMMARY

The business jet market in the PRC itself added 60 business jets in 2012 – like the overall Greater China market – a growth rate of 40%. Although this represents an increase in absolute numbers over 2011 (60 versus 43 A/C in 2011), the growth rate slowed from 45% in 2011. The growth rate in the PRC has been steadily decreasing for 5 years now.

In line with the added aircraft, the number of business jet movements per year in the PRC has increased 53% from 2010 to 2011.

BUSINESS JET FLEET – PRC

225

200 193 175

150 138 125

100 95 75 61 50 46

25 28

0 2007 2008 2009 2010 2011 2012

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 15 ANNUAL GROWTH YR TO YR PRC BUSINESS JET FLEET 70.0% 64.3%

60.0% 55.7%

50.0% 45.3%

39.9% 40.0% 32.6% 30.0%

20.0%

10.0%

0.0% 2008 2009 2010 2011 2012

ANNUAL BUSINESS JET MOVEMENTS – PRC

Growth 2010 to 2011: 53% 14507

8569 9512

2009 2010 2011

16 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 FLEET GROWTH IN 2012 – PRC SUMMARY

Examining the PRC fleet by business jet type, there are a number of trends and observations of note:

Over past 4 years, the biggest growth has been seen in the fleet of G550s, G450s, 605s, 7Xs, ACJ 318s & 319s and BBJs again reinforcing the dominance and importance of the Large, Super Large, Ultra Long Range and Corporate Airliner categories to the PRC market.

A number of specific aircraft fleets are aging:

• Average Year of Build prior to 2000: Citation II, VI & 525s Lear 35/36s Challenger 800s

• Average Year of Build prior to 2005: Cessna CJ1 & Excel Hawker 800/850

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 17 FLEET SIZE BY MODEL – PRC 2009 – 2012

End 2009 End 2010 End 2011 End 2012

111111 10 7 8 6 5 4 4 4 4 3 3 1 1 1 1 1 1 1 1 1 1 1 1 CJ3 Cit II Cit X Cit VI Excel C525 CJ1/1+ Mustang Sovereign XLS/XLS+

9 7 7 7 5 4 3 4 4 3 3 4 3 2 2 1 1 1 1 1 1 1 1 1 1 1 BBJ L650 L1000 H4000 ACJ319 ACJ318 A319 VIP A319 H400/XP H900/XP H800/850

11 8 7 7 7 7 8 6 5 5 5 5 3 3 5 5 5 5 5 5 5 4 1 3 2 1 1 1 2 1 2 CL870 CL300 CL605 CL800 CL850 GL-XRS G5000 G6000 L35/36 GLOBAL L60/60XR

24 20 13 12 11 8 9 10 4 4 4 4 6 6 1 1 1 1 1 1 1 1 1 1 3 2 3 3 GV F7X G200 G450 G550 F2000 GIV/SP F900LX F2000LX F900DX/EX

18 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 HONG KONG FLEET GROWTH IN 2012 SUMMARY

The Hong Kong market counted 111 business jets at the end of 2012.

Hong Kong is a large business jet market where the Ultra Long Range and Super Large business jets fleets alone represent 57% of the market

The undisputed leader is Gulfstream with the G550 and G450.

The G550 is far ahead its Bombardier Global competitors (28 versus 7

CJ3 aircraft) and Falcon is still trying to find a market for the 7X in Hong Kong Cit II Cit X Cit VI Excel C525 with only 2 aircraft. CJ1/1+ Mustang Sovereign XLS/XLS+ The G450 likewise surpasses the G5000 two to one and Falcon still has yet to establish itself with only just one each F900EX and F900LX in Hong Kong.

The biggest operator in HK is Metrojet, followed by TAG, Jet Aviation HK and Hong Kong Jet. These 4 operators manage 81% of the HK fleet and each management company on average operates 10 different business jet types in their fleet.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 19 HONG KONG FLEET BY SEGMENT

S-LITE 1%

LIGHT 1% MID 1%

CORP A/L 9%

S-MID 11%

LARGE 20% 111 Aircraft in Total

ULTRA LR 34% S-LARGE 23%

HONG KONG FLEET BY AIRCRAFT TYPE 28 111 Aircraft in Total

12 12 10 11 6 3 5 4 1 1 1 2 1 1 1 2 1 1 1 1 2 1 2 1 GV CJ3 BBJ F7X A318 L650 G200 G300 G450 G550 CL604 CL605 CL850 H4000 GL-XRS G5000 GIV/SP ACJ319 ACJ330 F900LX GLOBAL F2000LX XLS/XLS+ L60/60XR F900DX/EX

20 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 HONG KONG OPERATORS – FLEET SIZE

28 25 21

7 7 4 2 1 ASIA JET SINO JET INT’L JETCLUB METROJET LTD. METROJET JET AVIATION HK AVIATION JET HONG KONG JET HONG KONG TAG AVIATION ASIA AVIATION TAG BAA JET MGMT LTD. BAA JET HK GOVMT FLYING SERVICE FLYING HK GOVMT

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 21 22 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 METROJET – HK FLEET COMPOSITION

12 28 Aircraft in Total

4 3 3

1 1 1 1 1 1

XLS/XLS+ L650 BBJ CL605 GLOBAL G5000 G200 G450 GV G550

Metrojet manages 28 aircraft in Hong Kong. Its fleet is dominated by Gulf- streams – 20 aircraft out of the 28 (71% of its fleet).

TAG AVIATION – HK FLEET COMPOSITION

7 25 Aircraft in Total

2 2 2 2 1 1 1 1 1 1 F7X G450 G550 CL604 CL605 CL850 GL-XRS G5000 ACJ319 GLOBAL F2000LX L60/60XR

TAG Aviation manages 25 aircraft which are predominately Bombardier models – 17 aircraft (68% of its fleet). It is the largest operator of Global 5000s in Asia.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 23 JET AVIATION BUSINESSJETS(HK)LTD. HK FLEET COMPOSITION

21 Aircraft in Total 8

4 3

2 1 1 1 1

CJ3 CL605 GLOBAL G5000 F900LX G200 G450 G550

Jet Aviation (HK) manages 21 aircraft of which 15 are Gulfstreams – 71% of its fleet.

HONG KONG JET – HK FLEET COMPOSITION 16 Aircraft in Total

3 3

2 2

1 1 1 1 1 1 BBJ G200 G550 CL605 H4000 GIV/SP ACJ319 ACJ318 ACJ330 GLOBAL

Hong Kong Jet manages 16 aircraft of which 7 are Corporate Airlines – 44% of its fleet – making Hong Kong Jet one of the largest operators of these types in Asia.

24 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 SINO JET – HK FLEET COMPOSITION

1 1 1 1 1 1 1

L650 CL605 GLOBAL G5000 G200 G450 G550

BAA JET MANAGEMENT LTD. HK FLEET COMPOSITION 2

1 1 1 1 1

CL605 F900DX/EX F7X G200 G450 G550

OTHER HONG KONG OPERATORS Asia Jet 2 x G200 1 x G300 1 x GIV

HK Government Flying Service 2 x CL605

Int’l Jet Club 1 x BBJ

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 25 PRC BUSINESS JET MARKET 2012 SUMMARY

The PRC market counted 193 business jets at the end of 2012 with 55% of the fleet operated by the top 4 management companies.

Of note is that 18% of the fleet in the PRC (35 A/C) operates in Special Mission applications including Government / Military transport, Flight Inspection, Air Ambulance, Flight Training and Aerial Surveillance.

61% of the PRC fleet is in the Large Cabin, Super Large, Ultra Long Range and Corporate Airliner categories.

As per the reoccurring theme in this report, Gulfstream dominates the Ultra Long Range category with the G550 and the Super Large with the G450. The Gulfstream G200 shares the honors although the Super Mid- Size category is led by Bombardier’s Challenger 300. Bombardier is the leading OEM in the Large Cabin category with the Challenger 605. Airbus dominates the Corporate Airliner class.

Of note are a couple of market peculiarities:

• There are no Global 5000s in the PRC fleet – all are operated by HK management companies.

• The Falcon 7X which had some difficulties in the HK market, has found a willing and growing customer base in the PRC.

• Another “late bloomer” and one to watch in the PRC market is the Legacy 650.

Over the last 3 – 4 years, the PRC market shares of Gulfstream and Bombardier have not changed significantly year to year. What is happening, given the current market trends, is Falcon and Embraer are taking market share from Cessna and Hawker.

26 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 THEFLEET PR BY CHINA SEGMENT BUSINESS – PRC JET MARKET 2012 SUMMARY LIGHT 8% VLJ 1%

S-LITE 8%

CORP A/L 7%

MID 10%

ULTRA LR 23% 193 Aircrafts in total S-MID 12% 61% of the Fleet Large Cabin & Up

S-LARGE 13% LARGE 18%

AIRCRAFT TYPES – PRC FLEET 24 20

11 10 10 9 8 8 8 6 5 5 4 5 4 4 5 4 5 4 3 3 3 3 3 3 2 2 1 1 1 1 1 1 1 1 1 1 1 1 GV CJ3 BBJ F7X Cit II Cit X Cit VI Excel L650 C525 G200 G450 G550 CL870 L1000 CL300 CL605 CL800 CL850 F2000 H4000 GL-XRS G6000 GIV/SP ACJ319 CJ1/1+ ACJ318 F900LX L35/36 GLOBAL Mustang A319 VIP A319 F2000LX H400/XP H900/XP XLS/XLS+ Sover eign Sover L60/60XR H800/850 F900DX/EX

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 27 PRC OPERATORS – FLEET SIZE

Top 4 Operators 55% Market Share

11 11 7 8 4 4 6

BEIJING CHINA BAA LTD. CAPITAL DONGHAI LILY JET HANWHA CITIC GA NANSHAN AIRLINES EASTERN AIRLINES/ JET AIRLINES DEER JET

PRC SPECIAL MISSION OPERATORS – FLEET SIZE

6 5 4

CAAC FIC AIR-MED CAAC CHINA CHINA FLYING REMOTE UNITED/ COLLEGE SENSING OCEAN

28 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 CAPITAL AIRLINES/DEER JET – FLEET COMPOSITION

57 Aircraft in Total

7 6 4 4 3 3 2 2 2 2 2 1 1

H800/850 H900/XP H4000 A319VIP ACJ319 BBJ CL605 GL-XRS F7X G200 GIV/SP G450 GV G550

36 Gulfstreams 63% of the Fleet

The Capital Airlines / Deer Jet business jet fleet is the largest in Asia and predominately includes Gulfstream aircraft: 36 A/C or 63% of its fleet.

The fleet is split however with different roles & ownership:

• 32 A/C – Owned & Chartered Out (56% of the fleet) • 25 A/C – 3rd Party Owned & Under Management (44% of the fleet)

Capital Airlines and Deer Jet is part of the HNA Group which also includes Hong Kong Jet.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 29 BAA LTD. – PRC FLEET COMPOSITION 6 27 Aircraft in Total

3 3 3 2 2 2 1 1 1 1 1 1

CJ1/1+ H4000 ACJ318 ACJ319 L60/60XR CL605 CL850 G6000 F900LX F7X G200 G450 G550

BAA Ltd. in the PRC manages 27 aircraft. But when This combined fleet is also comparatively well balanced considering the HK based fleet managed by BAA Jet between Gulfstream (44%), Bombardier (26%) and Management Ltd., the combined fleet is 34 business Falcon (15%). jet and represents one of the largest fleet of privately owned and managed aircraft in Greater China and Asia.

BEIJING AIRLINES – PRC FLEET COMPOSITION

5 11 Aircraft in Total

2 1 1 1 1

ACJ318 ACJ319 BBJ GL-XRS F7X G450

CHINA EASTERN BUSINESS JET PRC FLEET COMPOSITION

3 11 Aircraft in Total

1 1 1 1 1 1

H800/850 L650 ACJ318 CL300 GL-XRS F2000LX G200 G550

30 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 31 LILY JET – PRC FLEET COMPOSITION

8 Aircraft in Total 3

1 1 1

CL605 CL800 CL850 GLOBAL G6000

DONGHAI JET – PRC FLEET COMPOSITION

7 Aircraft in Total

CL300 CL605

NANSHAN – PRC FLEET COMPOSITION

6 Aircraft in Total 2

1 1 1 1

CL605 GL-XRS F7X G450 G550

32 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 OTHER PRC OPERATORS In addition to the Special Mission fleets

Asia Wings 1 x H800 1 x CL605

Hanwha Airlines 2 x CL300 2 x G450

Int’l Jet Club 1 x Excel 1 x F2000 1 x F900DX 1 x F7X

Broad Air Conditioning 1 x Cit 525 1 x Excel

Minsheng 1 x Sovereign 1 x H900XP

Comlux 1 x ACJ318 Global Jet Concepts 1 x GL-XRS China Southern Business Jet 1 x Lineage Big White Bear 1 x G200 Shanxi Aviation 1 x Excel Zhongfei Airlines 2 x Cit II Poly Technologies 2 x Cit II Dengbin 1 x Mustang Latitude 33 1 x CJ3 CAAC Flt University 1 x CJ1

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 33 GREATER CHINA BUSINESS JET MARKET – BY OEM SUMMARY

OEM MARKET SHARE

Greater China (all regions) Hong Kong PRC

49.5%

36.3% 32.4% 31.6% 28.9% 28.5%

15.5%

9.8% 8.0% 9.3% 4.5% 6.2% 5.4% 4.5% 5.2% 6.0% 4.5% 2.4% 3.3% 1.8% 0.9% 1.8% 2.1% 1.6%

Cessna Hawker Embraer Airbus Boeing Bombardier Falcon Gulfstream

34 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 BREAKDOWN BY MODEL – CESSNA FLEET GREATER CHINA

10 33 Aircraft in Total

4 4 3 2 1 1 1 1

Cit II CJ1/1+ Cit VI CJ3 C525 Excel XLS/XLS+ Sovereign Cit X Mustang

No net growth in the fleet from 2011 to 2012.

Little growth over the last 3 years with only 1 net aircraft was added in 2010 and 2 net aircraft in 2011.

91% of the fleet is based in the PRC which is not too surprising given the shorter range, domestic usage the Cessna model range is designed for. A sizeable portion of the fleet is also used by a number of training schools in the PRC and also a number of aircraft are utilised in special mission applications:

• 10 CJ1s for training

• 5 Excels utilised by the CAAC Flight Inspection. Center for airways calibration missions

The fleet is an aging one, which is indicative of Cessna’s early success as one of the pioneers in the PRC market.

This early success Cessna has been unable to capitalise on though as the range of available models has not catered to more recent large cabin and ultra-long range tastes of high net worth individuals in the PRC: 18% of the fleet was manufactured before 2000 and 61% of the fleet was manufactured in 2005 or before.

Cessna’s hope is its new mid-size business jet, the Citation Latitude, scheduled to enter service in 2015, will reverse its fortunes in PRC. In the meantime, Cessna’s dedicated Citation sales team has increased to nine members in the PRC, reflecting the company’s increased focus on the commercial market and determination to build on success already achieved in the governmental sector.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 35 Cessna strengthens its support network:

• Based a dedicated field service manager in the PRC.

• Beijing DINGSHI GA Tech Service Center (CFIC) was appointed a Citation authorised service facility.

• Shanghai Hawker Pacific Business Aviation Service Centre (SHPBASC) was appointed an authorised service facility.

• Cessna opened a new regional service center in Singapore at Seletar Aerospace Park.

Cessna also signed a number of agreements relating to its future business opportunities in the PRC:

• A strategic agreement with the China Aviation Industry General Aircraft Company Ltd., (CAIGA) and the Shijiazhuang Municipal Government for an eventual joint venture whose purpose will be the final assembly, sales, and customer support for the Cessna Caravan in China for the PRC market.

• A joint venture contract with China Aviation Industry General Aircraft Company Ltd., (CAIGA) (through CAIGA South China Aircraft Industry Co., Ltd.) for the formation of a joint venture company to conduct final assembly of Cessna Citation XLS+ aircraft in China for the PRC market.

Operator Mustang Cit II CJ1/1+ Cit VI CJ3 C525 Excel XLS/XLS+ Sovereign Cit X

JET AVIATION (HK) 1

METROJET LTD. 1

BAA LTD. 1

CITIC GA 1

CAAC FIC 5 2

BROAD AIR CONDITIONING 1 1

PAN AM INT’L ACADEMY 2

CAAC FLYING COLLEGE 6

SHANXI AVIATION CORP. 1

ZHONGFEI AIRLINES 2

POLY TECH 2 1

CASC 1

DENGBIN 1

MINSHENG 1

LATITUDE 33 1

CAAC FLIGHT UNIVERSITY 1 1 4 10 1 2 1 3 6 3 1

36 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 BREAKDOWN BY MODEL – HAWKER FLEET GREATER CHINA

27 Aircraft in Total 9

6 5 4 3

H400/XP H750 H800/850 H900/XP H4000

Given HBC’s bankruptcy and with the future of the Hawker product line uncertain, the Hawker fleet in Greater China is characterized by “aging” and “for sale”:

• The H800s were all delivered during the period from 1999 to 2002 so the fleet is at least 10 years old.

• The four (4) H750s are for sale.

• Two (2) H900XPs are for sale.

• At least two (2) H4000s are for sale.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 37 The writing on the wall was evident too at the 2012 China International Aviation & Aerospace Exhibition (Airshow China), the PRC’s largest airshow, where HBC only displayed its King Air products.

It is clear HBC plans to only focus on piston and turboprop aircraft in the PRC for the immediate future.

Operator H400/XP H750 H800/850 H900/XP H4000

HONG KONG JET 1

CHINA EASTERN 1

BAA LTD. 2

HNA GROUP 6 3 2

ASIA-WINGS (YIFENG) 1

AIR-MED 1 1

MINSHENG 1

EXEC. AVIATION TAIWAN (ROC) 1

SUNRISE AIRLINES (ROC) 1

JET ASIA (MACAU) 4 2 3 4 9 6 5

38 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 BREAKDOWN BY MODEL – EMBRAER FLEET GREATER CHINA

8 Aircraft in Total

L600 L650 L1000

Embraer saw considerable success in the Greater China Market in 2012 even though its deliveries only numbered 8 executive jets. In the PRC market alone, the company booked 28 firm orders and five options for its executive jets. Embraer’s market share is set to grow considerably in 2013 and the following years. This market share, if current market trends continue, will come at the expense of Cessna and HBC.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 39 Other highlights for 2012 include:

• Embraer signed an agreement with Aviation Industry Corporation of China (AVIC) for final assembly of Legacy 600/650 jets in China, using the resources of their joint venture, the Harbin Embraer Aircraft Industry Co., Ltd.

• The 200th aircraft of the Legacy family, a Legacy 650 large executive jet, was delivered to China’s Minsheng Financial Leasing Co., Ltd. (MSFL).

• Embraer Executive Jets signed an Authorized Service Center agreement with ExecuJet Haite Aviation Services China Co., Ltd. (ExecuJet Haite) in Tianjin.

• Both Embraer’s entry-level Phenom 100 and 300 executive jets received the Validation of Type Certificate issued by Civil Aviation Administration of China (CAAC).

• 1st Lineage 1000 ultra-large executive jet delivered in China to Xinjiang Guanghui Industry Investment Group Co., Ltd.

Operator L600 L650 L1000

METROJET LTD. 1

SINO JET 1

CHINA EASTERN 3

CHINA SOUTHERN 1

MACAU LANDMARK (MACAU) 1 1 1 5 2

40 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 BREAKDOWN BY MODEL – AIRBUS FLEET GREATER CHINA

18 Aircraft in Total 10

1 1

A319 VIP ACJ318 ACJ319 ACJ330

Operator A319 VIP ACJ318 ACJ319 ACJ330

TAG AVIATION ASIA 1

HONG KONG JET 1 2 1

BEIJING AIRLINES 1 1

CHINA EASTERN 1

BAA LTD. 2 1

HNA GROUP 1 2

COMLUX - PRC 1

COMLUX - MACAU 1

OTHER 2

1 6 10 1

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 41 BREAKDOWN BY MODEL – BOEING FLEET GREATER CHINA

9 11 Aircraft in Total

BBJ BBJ2

Operator BBJ BBJ2

METROJET LTD. 1

INT’L JETCLUB 1

HONG KONG JET 3

BEIJING AIRLINES 1

HNA GROUP 2

OTHER 1 2

9 2

42 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 BREAKDOWN BY MODEL BOMBARDIER FLEET GREATER CHINA

97 Aircraft in Total

9 10 9 10 8 7 5 4 5 2 2 2 CL870 CL601 CL300 CL604 CL605 CL800 CL850 GL-XRS G5000 G6000 L35/36 GLOBAL L60/60XR

As one would expect from the OEM with the most diverse product range – Learjets, Challengers and Globals – Bombardier is in the enviable position of having the most diverse customer base. Bombardier and its products do it all it seems including Private, Corporate, Shuttle, Charter, Government / Military Transport, Air Ambulance, Aerial Surveillance, and Search & Rescue.

Whereas its Learjet products have yet to find a new market in China, Bombardier’s Challenger products continue to be very successful and completely dominate the Large Cabin sector. This is not the case for its Global line though as they run a distant second to Gulfstream.

Of note, Bombardier Business Aircraft also has one of the richest histories in China stretching back to the late 80s with Challenger 601s sales to the PRC. The first Global was sold in 2000 into HK; the first Global 5000 for operation in the PRC in July 2009; the first Learjet 60XR and Challenger 850 in the PRC in March 2010.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 43 Operator L35/36 L60/60XR CL300 CL601 CL604 CL605

TAG AVIATION ASIA 1 2 2

JET AVIATION (HK) 2

METROJET LTD. 3

SINO JET 1

BAA JET MGMT LTD. 1

HK GOVMT FLYING SERVICE 2

HONG KONG JET 1

BEIJING AIRLINES

CHINA EASTERN 1

BAA LTD. 1 3

HNA GROUP 2

DONGHAI JET 5 2

LILY JET 2

ASIA-WINGS (YIFENG) 1

HANWHA AIRLINES 2

GLOBAL JET CONCEPTS

NANSHAN 1

AIR-MED 2

CHINA REMOTE SENSING 5

CHINA UNITED / OCEAN

COMLUX - PRC

PAC-AIR (ROC)

JET ASIA (MACAU) 2 1

OTHER

5 4 8 2 2 24

44 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 CL800 CL850 CL870 GLOBAL GL-XRS G5000 G6000

4 1 1 7

1 1

3 1

1 3 1 1

7 5

9 10 5 9 7 10 2

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 45 BREAKDOWN BY MODEL – FALCON FLEET GREATER CHINA

20 Aircraft in Total 11

3 2 2 2

F2000 F2000LX F900DX/EX F900LX F7X

Falcon is another OEM to watch for in the Greater China market, especially the 7X in the PRC. Most of the new orders for Falcon are for the Falcon 7X, with a growing backlog of the tri-jets scheduled to be delivered in China in the coming years.

2012 saw Falcon complete its transformation in the PRC with the establishment a ‘wholly owned foreign entity’ to represent the Falcon brand in the growing Chinese market. The subsidiary, known as ‘Dassault Falcon Business Services (Beijing) Co. Ltd’, is based in Beijing, China. Falcon sold its first new business jet in China in 2006. In 2010, an international sales and marketing office was established in Beijing with another office in Shanghai opened in 2012. Together with an office in Hong Kong, Falcon’s presence in the country has steadily increased.

Early 2013 will see Falcon establish a regional Customer Service headquarters in Beijing, China. The office will be staffed by local specialists experienced in receiving and processing spare parts orders, warranty and FalconCare claims. The office will also oversee four Field Technical Representatives that are based in Greater China. Additionally, at least two type rated Falcon pilots will be based in Beijing to provide jump-seat support to new and existing Falcon customers.

46 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 Additionally on the support side, Falcon and Aerospace Products International (API) have expanded their logistics services agreement to support Falcon customers operating in China, Hong Kong and Macau. Falcon launched “Dassault Falcon Aircraft Services – China”, a dedicated program with Shanghai Hawker Pacific at Hongqiao International Airport in Shanghai, and Dassault Aircraft Services – Wilmington was granted approval by the Civil Aviation Administration of China (CAAC) to perform airframe and component maintenance on China registered Falcons.

Operator F2000 F2000LX F900DX/EX F900LX F7X

TAG AVIATION ASIA 1 1

JET AVIATION (HK) 1

BAA JET MGMT LTD. 1 1

BEIJING AIRLINES 2

CHINA EASTERN 1

BAA LTD. 1 2

HNA GROUP 2

CITIC GA 1 1 1

NANSHAN 1

MACAU JET (MACAU) 1 1

OTHER 1 2 3 2 2 11

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 47 BREAKDOWN BY MODEL GULFSTREAM FLEET GREATER CHINA

122 Aircraft in Total 55

6 4 1 1

Astra/G100 G200 G300 GIV/SP G450 GV G550

Gulfstream # 1 Market Share in Greater China 36.3%

G550 # 1 Market Share in the Ultra Long Range category in Greater China 62.5%

G450 # 1 Market Share in the Super Large category in Greater China 62.3%

G200 # 1 Market Share in the Super Mid-Size category in Greater China 61.1%

In 2012 Gulfstream also: • Opened an aircraft service center in Beijing — Gulfstream Beijing – a joint venture (JV) between Gulfstream and two subsidiaries of Hainan Airlines Group, Hainan Aviation Technik (HNAT) and Deer Jet.

• In collaboration with training provider FlightSafety International, inaugurated a full-flight G450/G550 simulator based in Hong Kong.

• Established a satellite flight department in Hong Kong to support Gulfstream operators staffed by five pilots: three large-cabin demonstration pilots, one mid-cabin demonstration pilot and a chief pilot type-rated in both large- and mid-cabin aircraft.

• Had its service center in Appleton, Wis., earn approved maintenance organization (AMO) designations from China.

48 The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 Operator Astra/G100 G200 G300 GIV/SP G450 GV G550

TAG AVIATION ASIA 2 2

JET AVIATION (HK) 3 4 8

METROJET LTD. 3 4 1 12

SINO JET 1 1 1

ASIA JET 2 1 1

BAA JET MGMT LTD. 1 1 2

HONG KONG JET 1 1 3

BEIJING AIRLINES 5

CHINA EASTERN 1 2

BAA LTD. 1 6 3

CAPITAL AIRLINES/DEER JET 7 4 4 3 18

HANWHA AIRLINES 2

BIG WHITE BEAR 1

CAAC FIC 1

NANSHAN 2 1

AIDC (ROC) 1

EXEC. AVIATION TAIWAN (ROC) 1

AVIATION INT’L CORP (ROC) 1

WIN-AIR (ROC) 1 2

1 22 1 6 33 4 55

For the purpose of this report, Greater China includes the PRC, ROC (Taiwan), HKG and Macau.

The GREATER CHINA BUSINESS JET FLEET – YEAR END 2012 49 ASIAN SKY GROUP STRATEGIC PARTNER 11/F, Tower 2, Admiralty Centre www.asianskygroup.com 18 Harcourt Road Admiralty, Hong Kong AVIC International ADC Telephone +852 3478 3927 Facsimile +852 3975 3000