A Chinese company and a Russian aviation institute have agreed to launch a private airplane production project in northeast China’s Jilin Province.

The cooperative venture, with a total investment of RMB800 million ($106 million), is expected to produce 500 two-seat and four-seat light aircraft and seaplanes for private use every year with an estimated revenue of RMB800 million.

Jilin-based Dingxin Technology and the Moscow Aviation Institute will be the two owners.

The Chinese company will hold 60% and the remaining 40% will belong to the institute. It will be located in the Jilin Municipal Economic Development Zone nearly 100 km east of the provincial capital Changchun.

Matveenko Alexander, principal of the institute, said the planes are likely to enter the northeast Asian market after the project is put into operation.

Which raises the small problem of where the planes will fly in China. As matters stand the control of air space means that general aviation — the term used for small aircraft being used for private business and pleasure — has little space in which to manouever. No doubt this will change now that China is going to produce its own light aircraft.

The illustration is of a Chinese light aircraft, the Little Hawk-500, which is about to start a spin test in Xi’an. This was the last in a series of flight-tests and the aircraft waltzed through it. This was the first time civil aviation had had this test in China.
Source: China.org.cn

On July 22, the first private aircraft shop was opened in Hangzhou, Zhejiang Province, with mainly planes and helicopters in its major stock. Currently, there are more than 10 private planes in Zhejiang Province, while the national figure is no more than 100.

Li Shurong, a financial analyst said, ‘There is a huge demand for private aircraft in China. Thus a great many capable pilots and technicians and related regulations will be needed to guarantee the healthy development of the industry.

‘It is normal to witness the booming of private aircraft, as nowadays a helicopter is no more expensive than a BMW. However, we don’t have related laws and regulations, thus many enterprises are still biding their time.’

Currently, many enterprises are already using private aircraft. It requires about two weeks to apply for the opening of a private airline which is one way around the regulations.

According to the latest data, there are 200 Chinese with private aircraft driving licenses, including owners of small and medium-sized enterprises, ordinary workers and college students. This will change as China’s ability to manufacture aircraft increases and more air space is freed. At the moment much of it, the majority, is under the direct control of the PLA and until that changes to a significant degree general aviation will be difficult. But eventually it will happen. China is a country designed for general aviation.
Source: China News.cn

China Southern Airlines is the biggest airline in China and now doing very nicely as are all the others. This year they may all expect a 16% increase in number of passengers carried because of economic growth and rising inbound tourism.

The General Administration of Civil Aviation of China said in a statement on its web site that China’s airlines may carry 185 million passengers in 2007. The number of passengers rose 16% to 160 million a year earlier.

Passengers are likely to take a total of 1.5 billion domestic flights in China in 2007, 8% more than a year earlier. This is a reflection of the country’s economic growth which makes leisure and business trips affordable to more people.

Cargo traffic was expected to reach 3.9 million tons, up 12% year on year, as exports and imports expand to $2 trillion. The administration said it would revise current plans for price reforms and launch new rules of charging at local airports this year.
Source: TD Trade and Shanghai Daily

China Southern Airlines has received thousands of applications to join a pilot training course where the students pay RMB710,000 ($90,000) to be taught to fly.

Chengdu Shangbao, a newspaper in Southwest China’s Chengdu City, said that the airline nearly 2,000 applications for 100 openings in the first 10 days. The company has promised to hire graduates from the project as its pilots.

Student loans are available and the RMB710,000 will be paid in three installments. The head of Southern airline’s flight management department said that tuition plus loan interest might be RMB900,000. However, a pilot can earn RMB2,900,000 in 10 years so as a return on capital invested that it not all that bad.

Southern Airlines is the first carrier on the Chinese mainland to ask some of its student pilots pay for their own tuition. Normally, airlines cover all training and study costs for pilots although for that they are almost indentured to the airline and have to pay up if they want to move elsewhere.

Faced with a shortage of pilots and bothered by labor contract disputes with former pilots, many domestic airlines, including Southern Airlines, also plan to recruit more pilots from overseas.
Source: Shanghai Daily

IATA, the International Air Transport Association (IATA) has identified five challenges China will face in an air industry which can compete at world levels. These are: efficient air traffic management, environmental sustainability, cost-efficient airport infrastructure, internal cost control and commercial freedoms.

However, note that IATA. almost by definition, is representing all the other commercial airlines (a vocal slab of which is American neatly protected from true competition by Americ’a strange bankruptcy laws) and commercial freedom is something members of IATA have been squabbling about among themselves since it was formed. Basically what most IATA members want is commercial freedom from everyone else, but not for everyone else.

Giovanni Bisignani, IATA’s Director General and CEO and shown here, at the China Civil Aviation Development Forum in Beijing, said, ‘China has an important role in the industry today, and is a future global leader for air transport. By 2010, the largest single market for aviation will be intra-Asia, accounting for nearly a third of all air travel with China at the centre. China is at a critical moment that is also a great opportunity. And to build a more successful future, China has to avoid the mistakes made in other parts of the world.’

He went on, ‘ While there have been impressive accomplishments in China - IATA-1 was opened last year that cuts 30 minutes off a round trip to Europe, RVSM will be implemented this year — big challenges still remain. The congestion delays in the Golden Triangle can be measured in hours, while the inefficient airspace design in the Pearl River Delta is costing HK$1 million a day with Chinese carriers being the most affected. We need a solution quickly.’

And IATA would like, please, to have the prices of going and coming lowered.

Giovanni Bisignani said, ‘China has some of the highest charges in Asia outside of Japan. With uniform charges for all Chinese airports, they are definitely not cost-related. IATA is working with the government to develop a charges regime that challenges airports on efficiency, provides a reasonable return to investors, and supports a competitive industry.’

The competitive industry would, of course, mainly be members of IATA and, indeed, again he has a point.

Massive landing charges curtail commercial development and China will have to make up its mind of what basis those charges should be made.

He then got to commercial freedom which is a tricky point with every major country in the world and it is pointless trying to blame one country over another.

He said, ‘The recent US-EU open-skies agreement moves the industry in the right direction, but falls short of the fundamental change we need. China’s fast growing economy demands efficient air transport links, and progressive liberalisation has played an important role — opening Hainan as a free port for aviation services, liberalising bilaterals with the US, ASEAN, Japan and Korea. With the aviation industry’s centre of gravity moving East, China has an enormous leadership opportunity to shape policy where the US and EU have failed to do so.’

It may well be he is hoping for too much.
Source: Money Control