Sunday, October 21, 2012

General Aviation in China

The aviation industry in China has drastically changed in the last decade.  The reasons for the change include some of the demands that have created a large aviation industry in the United States.  Here in the US, we use aviation for the movement of goods and people, medical purposes, and pure enjoyment.  Unfortunately, the people of China are not able to make decisions for themselves.  The government (more specifically the military) of China has always been in control of aviation and the country's airspace.  In the last decade, the government has decided that they would like to develop a general aviation industry.  The military has worked on opening and redeveloping airspace.  The most likely reason for this change is the government's interest in making more money, and growing their country and economy.  In 2003, China ended their ban on private airplane ownership, opening a whole new world for the country of China.
As everyone knows, people and companies in the United States ARE free to make their own decisions.  Several aviation companies in the United States have used the Chinese aviation boom to their advantage.  Hard times in the US economy have severely hurt our aviation industry.  A few general aviation companies have been near bankruptcy, or have already filed bankruptcy.  Hawker Beechcraft filed bankruptcy in May, 2012, and shortly after, engaged in talks to sell to a Chinese company.  The sale DID NOT happen, and Hawker Beechcraft is still a US based company.  This attempted sale is just another example of a relationship that has been created between the United States and China.  The economy in the United States has been hurt, and the economy in China is growing.  Companies in the United States are in need of money, and have technology that Chinese companies are looking for.  Chinese companies can buy American companies, and their technology, for a lot less than doing research to develop their own technology.


The development of general aviation in China has affected other companies based in the United States.  A few companies in the United States are developing relationships with China, and will begin to manufacture airplanes in China.  Other US companies are being sold entirely to Chinese companies.  One such example is the United States kit plane company, Glasair.  Glasair was sold to the Chinese company, Fang Tieji, on July 20, 2012.  Fang Tieji plans to keep Glasair based in Arlington, Washington.  The Chinese company also plans to fully certify the Glasair Sportsman airplane.  The purchase of this company will allow Fang Tieji to bring this technology to their country as well.

This activity creates opportunity for the US general aviation sector.  Companies can help rebound financially by getting involved in the Chinese market.  This can be done in a few ways.  Companies can sell all or part of their business.  There are Chinese buyers, and it might be a great way to stop losing money.  US companies that do not want to sell could try and get involved with sales in China.  Individuals could also find creative ways to make a profit.  Working in China might be a great way to find a job.  Transporting general aviation airplanes to China might eventually create a job market.  There are many opportunities to make money for both companies, and individuals looking for jobs.

3 comments:

  1. I agree there are opportunities in China, and I think it will continue to be unpopular to sell out to foreign interests. Yet business is business and we will sell out to save money regardless of how low the wages are for the factory workers. Americans want cheap, safe airplanes, and it looks like China knows how to make them.

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  2. With the developing business opportunities in China, why do you think the China company dropped Hawker? It would have been a good idea to be able to add another US company to the list that has proven itself in the past.

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  3. Good point about the ban on private aircraft ownership until 2003.

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