China high-fliers no longer buy fancy planes
MAKERS of private jets for China's elite are shifting their focus from luxury to convenience, as a cooling economy and crackdown on corruption prompt demand for smaller planes and second-hand deals.
Utility is the watchword, say industry insiders.
Buyers, who once enlisted feng shui masters to help design cabin interiors that might feature mahjong tables or karaoke areas, now go for functional features.
China's richest businessmen remain Asia's top owners of luxury aircraft.
The greater China region had 466 private jets last year, according to consultancy Asia Sky Group, compared with 65 in 2007. Mainland China accounted for 300 of those.
But for manufacturers such as Bombardier, Dassault, Embraer and General Dynamics' subsidiary Gulfstream, the market is cooling, especially for new aircraft.
This has forced them to prioritise efficiency, keep production costs low and speed up aircraft delivery times.
The mood was subdued as plane makers, charter firms and buyers gathered this week for one of the industry's biggest annual air shows in Shanghai.
But interest in specialised firms who manage, charter or refurbish planes was high.
A state campaign against corruption has discouraged conspicuous consumption.
"Ten years ago, if you bought a business jet, you would show your shiny new plane off to reporters," said one China-based business jet broker.
"These guys have seen their peers being hauled up, and they don't want any scrutiny of their wealth and business interests. So they would rather keep a low profile."
Asia Sky Group put China's fleet growth last year at 6.6 per cent - from highs of more than 49 per cent in 2012.
Until recently, mainland Chinese buyers have favoured larger cabin jets, even including retrofitted versions of the Airbus A320 and Boeing 737 that can cost up to US$90 million (S$123 million) and US$10-15 million for fitting.
Now, there is more interest in smaller aircraft. "Instead of using too big a plane, people are flying in a smaller plane," said Fernando Grau.
He is director of airline market analysis at Brazilian manufacturer Embraer which hired actor Jackie Chan to sell its planes in China.