ABACE Convention News

Gama Builds China Momentum From Hong Kong

 - April 15, 2013, 8:15 PM
Neil Gibson, Gama Aviation Asia managing director

UK-based Gama Aviation (Booth P912) has been expanding rapidly in recent years, branching out from its home at the London-area TAG Farnborough Airport to set up bases in the U.S., Dubai, Sharjah and Switzerland, as well as establishing a presence at Glasgow in Scotland. And now China is firmly in its sights for growth.

Having started out with a single Beech Baron in 1983, and later acquiring several other charter and management operators in the UK, Gama’s first expansion overseas was into the United Arab Emirates in 2007, and then in the U.S. More recently it has set up offices in Jeddah, Saudi Arabia, and Hong Kong. The latter office was set up in May 2012 with an eye to the huge potential in China and Southeast Asia.

“When I came here in 2007 [as CEO of TAG Aviation Asia] there were only three operators, and now there are around ten, so it’s harder to penetrate the market,” said Gama Aviation Asia managing director Neil Gibson. “It is still a very inexperienced market in the region, if not in Hong Kong so much.”

Gibson told AIN that the purpose of the Hong Kong office at the moment is “trying to educate the customers,” and also, with Gama’s continuing push for growth, to find a partner in mainland China, partly because foreign investors can own only up to a 49-percent stake in a Chinese venture. “We are talking with someone at the moment,” he said.

In his view, the main criticism of the corporate aircraft market as it stands is that “sales people keep selling, but owners need to be able to enjoy their new airplane.” Gibson believes that, currently, owners and prospective owners don’t realize what is involved, and they need an experienced partner to look after and even operate the aircraft.

“A big part of my job is to try to make sure that prospective owners are getting the right advice from the right people,” said Gibson. “I think that AsBAA [the Asian Business Aviation Association] could do a big job helping with that; for example, by holding workshops for people who might want to own an airplane one day. The best time we can hear from a client is when they say, ‘I think I want to buy an aircraft,’ not just a few days before they take delivery of one, as it takes so long to get things in place. They often don’t realize the enormous amount of time and effort and the number of tasks that go into running an aircraft.” For example, he explained that it can take a minimum of three months to recruit a pilot and that an aircraft manager has to be recruited at least six months before delivery to ensure seamless entry into service.

Growing the Managed Fleet

“Our first objective is to start growing the managed aircraft fleet, as we are able to offer our own in-house Part 135 certificate,” Gibson explained. “[This means] we don’t have to partner with any other operators. That’s a big selling point, as we can put the [managed] aircraft on our Part 135 [certificate] flying charters. People like that.”

Gama’s first aim in China is, Gibson said, “to get other private or Part 135 aircraft into the management fleet then look at opportunities to develop the maintenance side of the business.” The company also sees scope for expansion in the wider Asia Pacific region.

“We’re not even thinking of having maintenance here in Hong Kong,” he added. There is only one airport in the region and competitors Metrojet, Jet Aviation and Haeco are already established there in the MRO field.

“Bizav is so young here [that] there are lots of possibilities, such as Thailand, where there are very few airplanes but maybe one day there will be lots,” said Gibson. “Here it feels like it felt in Europe maybe 12 years ago when Russia was about to get going.”

Optimistic About the Future

Although it may seem that business aviation is taking time to get going in Asia, Gibson noted: “It’s a whole lot better here than five years ago. You can now get a permit into China in days rather than months [for example].”

There are things that still cause frustration, however. “You still can’t fly in a straight line [due to restrictions in the military-controlled airspace] and only a few airports are available for public use–even though there are hundreds and hundreds of airports in China,” Gibson said. “We can still fly only to the places where the airlines are flying.”

Once these airports do become available, the market will really flourish, he predicted. “We’ll be able to fly people where they really want to go,” he said.

Currently, most of the business aircraft in China are long-range models. “I don’t know of anyone who has bought an aircraft just to fly within China,” said Gibson. But in the future, he said, “light jets will really come into their own.”

But for now it is a long process for Gama to gain recognition and trust in what is “a very different environment” from the UAE. Gibson is investing time to travel all around Southeast Asia and mainland China. “We’re putting down roots, as we want to be here for the long term. We are starting in a low-risk way, with just a handful of highly experienced people,” he concluded.