ASIAN SKY QUARTERLY ASIAN SECOND QUARTER 2019 UPCOMING AIRCRAFT DASSAULT FALCON 6X PRE-OWNED MARKET DASSAULT FALCON 8X SPECIAL FEATURE ASIA-PACIFIC FLIGHT ACTIVITY INTERVIEWS ASIA-PACIFIC OUTLOOK YAO ZHOU METRICS & MOOD BEIJING OFFICE PARTNER DENTONS BEIJING MARKET SUMMARIES JETS & HELICOPTERS ALEX JIAO, CEO HONGKONG JET FIRST QUARTER 2019 FIRST QUARTER BRIAN PROCTOR, CHAIRMAN INTERNATIONAL AIRCRAFT DEALERS ASSOCIATION ALL OTHERS FOLLOW THE BEST NEVER REST The G650ERTM recently achieved the fastest longest-range business jet flight in history—flying from Singapore to Tucson, Arizona, 44 minutes quicker than the previous record. With an industry-leading 90 world speed records and counting, you simply can’t go farther faster. ALL OTHERS CONTENTS FOLLOW 03 FOREWORD 30 INTERVIEW AsBAA Chairperson, Jenny Lau, discusses the association’s BRIAN PROCTOR, CHAIRMAN accomplishments over the last two years and wishes her INTERNATIONAL AIRCRAFT DEALERS ASSOCIATION successor well. Discussing IADA’s efforts towards ethical and standardized aircraft transactions. 04 ECONOMICS Overview of the Asia-Pacific’s region current status and 32 UPCOMING SPOTLIGHT specific country’s GDP versus their business jet and DASSAULT AVIATION FALCON 6X helicopter fleet size. An introduction to the Falcon 6X, with a complete look at the jet’s performance, cabin capacity and technology. 08 MOOD & INTENTIONS Results of our survey on the Asia-Pacific region’s outlook on 36 MARKET DYNAMICS economic status, aircraft utilization, purchase intentions and An analysis of inventory levels, market trends and the influencing factors. changing price signals for the business jet and helicopter fleets in the Asia-Pacific region. 14 INTERVIEW YAO ZHOU, BEIJING OFFICE PARTNER 44 AVIATION ADVICE DENTONS BEIJING HOLMAN FENWICK WILLAN Discussing the law firm’s expertise and experience in aviation, as Commentary by law firm HFW on the topic of grey charter well as the latest developments in aircraft finance and leasing. within business aviation. 18 SPECIAL FEATURE 48 CONFERENCE RECAP ASIA-PACIFIC FLIGHT ACTIVITY BY WINGX ROTORCRAFT ASIA CONFERENCE A look at the flight activity in Q1, including most popular Key takeaways and highlights from the Rotorcraft Asia flight routes and activities by OEM. Conference, held in Singapore. 22 INTERVIEW 53 MARKET SUMMARY - JETS ALEX JIAO, CEO, HONGKONG JET A look at market position and average days on market of Sharing the company’s insight on a challenging market and featured pre-owned business jets. news of its newly-acquired Aruba AOC. 63 MARKET SUMMARY – HELICOPTERS 26 PRE-OWNED SPOTLIGHT A look at market position and average days on market of DASSAULT AVIATION FALCON 8X featured pre-owned helicopters. A comprehensive market performance analysis of the pre- owned Falcon 8X. PUBLISHER The materials and information provided by Asian Sky of whatever nature for any losses, damage, costs Group Limited (“ASG”) in this report is for reference or expenses howsoever caused, whether arising only. Any information we provide about how we may directly or indirectly from any error or omission in interpret the data and market, or how certain issues compiling such information. This report also uses EDITORIAL may be addressed is provided generally without third party information not compiled by ASG. ASG Litalia Yoakum considering your specific circumstances. Such is not responsible for such information and makes Roderick Li information should not be regarded as a substitute no representation about the accuracy, completeness for professional advice. Independent professional or any other aspect of information contained. The DESIGN advice should be sought before taking action on any information, data, articles, or resources provided by Aya Leung matters to which information provided in this report any other parties do not in any way signify that ASG Michael Wong may be relevant. endorses the same. MARKET RESEARCH & DATA ANALYSIS ASG shall not be liable for any losses, damage, costs Bowen Zhang or expenses howsoever caused, arising directly or ADVERTISING/AIRCRAFT SALES ENQUIRIES: Avinava Sengupta indirectly from the use of or inability to use this report Alison Pang: [email protected] THE BEST NEVER REST Jordan Yuen or use of or reliance upon any information or material Casper Zhuang provided in this report or otherwise in connection with Maggie Gu any representation, statement or information on or contained in this report. Asian Sky Group The G650ERTM recently achieved the fastest longest-range business jet MEDIA SALES DIRECTOR Suite 1401, 14 Floor, Fortis Tower Alison Pang ASG endeavors to ensure that the information 77-79 Gloucester Road, Wan Chai, Hong Kong flight in history—flying from Singapore to Tucson, Arizona, 44 minutes contained in this report is accurate as at the date Tel: (852) 2235 9222 | Fax: (852) 2528 2766 quicker than the previous record. With an industry-leading 90 world of publication, but does not guarantee or warrant [email protected] speed records and counting, you simply can’t go farther faster. its accuracy or completeness, or accept any liability www.asianskygroup.com | www.asianskymedia.com SECOND QUARTER 2019 — ASIAN SKY QUARTERLY | 1 PUBLISHER’S NOTE I moved to HK in 1997 with the then Bombardier Business Aircraft Division. Looking back over the past 22 years, I’m able to say Asia’s business aviation community has grown stronger each year. In recent years one of the main reasons for this is the Asian Business Aviation Association (“AsBAA”). AsBAA has been an essential and significant voice in advocating for the industry in the Asia-Pacific region and is dedicated towards meeting the needs of business and general aviation. This ultimately supports all of us within this community and we owe our support back to AsBAA. At Asian Sky Group we’re certainly pleased to show this support, which you’ll now see reflected throughout each issue of Asian Sky Quarterly. In the coming issues, the AsBAA chairperson will share his or her thoughts on the industry and we’ll also get a glimpse of what the organization as a whole and each chapter is doing to keep pushing us all forward. In this issue, current Chairperson Jenny Lau looks back on all the positive work she’s spearheaded over past two years and passes the mantle on to her successor. Lots of great things going on at AsBAA … wish I could say the same for rates and purchase intentions. For a clearer picture of what’s happening the economic outlook as optimism levels continue to be at record lows. in the market, head to the ‘Mood & Intentions’ section in this issue of For the previous few quarters I had been cautiously optimistic about Asian Sky Quarterly. the economy, with what many of us thought was the beginnings of an ‘end in sight’ to the US-China trade dispute. But instead the dispute has As to the rest of Asian Sky Quarterly: the 2019 Q2 edition includes plenty escalated with each side continuing to flex their political muscles. In of insights on the market. Courtesy of WINGX is a look at Asia-Pacific the latest displays, the US imposed 25% tariffs on US$250B in Chinese flight activity in Q2. Brian Proctor, Chairman of the International Aircraft imports and essentially barred US companies from supplying critical Dealers Association (IADA), discusses the organization’s efforts toward components – without government approval – to Chinese telecom ethical aircraft transactions. Alex Jiao, CEO of Hongkong Jet, shares his giant Huawei. Beijing then responded with tariffs on US$60B worth of thoughts on the challenging market in Greater China and news of the US products and will draw up its own ‘unreliable entities’ blacklist. company’s newly-acquired Aruba AOC. Yao Zhou, PRC-registered lawyer with Dentons Beijing, discusses her experience with aircraft financing These tit for tat measures may play well to each sides’ domestic and leasing, as well as some of the latest developments’ owners fanbase, but each move drags down consumer confidence and should be aware of. More legal advice comes in the form of a column frustrates business. Certainly, in the US, the voice of dissent is getting by Holman Fenwick Willan on the area of grey charter. Also included louder, particularly from those in the agriculture sector. In China too, are spotlights on the upcoming Falcon 6X, along with an analysis of consumers and businesses are facing an economy that’s hit record pre-owned Falcon 8X market. This edition also features a recap of the lows. To overcome this, the Chinese Government has put into effect Rotorcraft Asia Conference held in Singapore, along with key takeaways stimulus measures to boost growth, which includes one of the largest from the event’s speakers. tax-cut packages in China’s history. As always, we hope this information is insightful. Despite all the recent moves in this trade war, I still believe a resolution will happen even though it’s not yet clear whether we’ve reached the highest points of tension yet or not. One thing is for sure - the decrease in economic optimism correlates directly with lower aircraft utilization Sincerely, Jeffrey C. Lowe Managing Director, Asian Sky Group SPECIAL THANKS TO OUR CONTRIBUTORS: 2 | ASIAN SKY QUARTERLY — SECOND QUARTER 2019 LOOKING BACK, LOOKING AHEAD FOREWORD In 2017, AsBAA, Asia’s non-profit representative body for the business and general aviation industry (BA/GA) appointed me as Chairperson, a role that I have been deeply honoured to hold for the past two years. I was elected by AsBAA members to represent, to advocate, and to create a community in which organisations can cooperate towards mutual success. In the time that I have been Chairperson of AsBAA, we have achieved good things. We have created stronger regional chapters to support members with localised issues. This would not have been possible without the outstanding contribution of the Board of Directors and Board of Governors.