UpdateThe high cost of flying a business jet in China
Although charter services may see a temporary rate drop because of overcapacity, it is hardly cheap to own a private jet in this part of the world.
Although charter services may see a temporary rate drop because of overcapacity, it is hardly cheap to own a private jet in this part of the world.
The close to 300 business jets in service on the mainland cost an average US$30 million each to buy and about 30 million yuan (HK$37.5 million) a year to use, said industry veteran Jason Liao, the chairman and chief executive of jet broker CBAJets.
"Of the 30 million yuan, 10 million yuan is financing cost if we assume a 5 per cent interest rate. The bulk of the rest is fixed costs, like fees for management, parking and maintenance no matter whether you fly or not," Liao said. "Then operational costs, including fuel, grow with the more hours you fly."
Flying an Embraer Legacy 650 - a model owned by Jackie Chan - costs 23,000 yuan an hour, according to CBAJets.
Business aircraft are handled by fixed-base operators (FBO) and, on the mainland, they can only be found at some airports.
Unlike in mature markets, where a hub airport for business aviation would have many FBOs competing to provide parking, refuelling and line maintenance services, there is no Chinese airport with more than one FBO.
Depending on the aircraft type, one landing in Beijing could cost more than 100,000 yuan, Liao said, adding "that is probably the most expensive in the world".