ABACE Convention News

Stretched Infrastructure, Limited Local Talent Hamstrings Hong Kong Bizav

 - April 11, 2018, 9:00 PM
Booming commercial traffic at Hong Kong International Airport leaves little space for business aviation operators.

Business aviation traffic in Hong Kong was on an upward trend from 2000 to 2015, but that has changed as the two runways at Hong Kong International Airport (HKIA) have reached capacity. Airlines that serve the airport and general aviation/business aviation (GA/BA) operators alike have experienced difficulties in securing runway slots.

At least 65 of the top 100 Hong Kong listed companies use business aviation. Of these, more than 50 percent are Hong Kong-based companies. The combined market capitalization of those 65 companies reached HK$13.7 trillion.

In accordance with guidelines published by the International Air Transport Association (IATA) in its Worldwide Slot Guidelines, which are followed by around 200 Level 3 airports in the world including HKIA, runway slots are assigned priority as follows: scheduled services, ad hoc services,  and other operations. GA/BA operations fall into the last category. GA/BA flights to/from HKIA numbered approximately 7,500 in 2016. As of November 2017, the total was 5,840. Primary destinations served by GA/BA flights include Beijing, Shanghai, Shenzhen, Singapore, Taipei, Tokyo, Macau, Manila, Hangzhou, Guangzhou, and Sanya.

The airport authority that operates HKIA has embarked on a three-runway system project that is now planned for completion in 2024. Upon completion, the project will enable HKIA to handle 607,000 aircraft movements per year, as estimated by IATA Consulting. This should ease the troubles GA/BA operators experience in securing runway slots.

Parking slots do not currently pose as big a challenge as runway slots. The Hong Kong Business Aviation Centre (HKBAC) FBO is equipped with an executive terminal and three hangars capable of accommodating up to 18 private jets. Additional GA/BA aircraft parking spaces are available at the adjacent Business Aviation Centre apron as well as at the midfield and west apron development area, providing a total of 82 parking positions for GA/BA aircraft at HKIA. Information officer Alice Mok of the Hong Kong Civil Aviation Department told AIN that as such, parking capacity is not currently a limiting factor at HKIA. 

HKBAC has increased recently the number of general aviation night slots to seven, in total. Other than expanding upon the runway, parking capacity, and flexibility, the industry would also benefit from a storage facility for aircraft parts in Hong Kong to allow for timelier maintenance services and the injection of new talent in the industry, noted Madonna Fung, general manager of HKBAC. "The storage would especially be beneficial for our industry because we are visited by a great variety of aircraft from all over the world and, with a good storage unit, aircraft maintenance can be completed in the shortest possible time," she added.

In terms of infrastructure, Hong Kong faces fierce competition in the region. In neighboring Guangdong province alone, Guangzhou, Shenzhen, and Zhuhai are keen to develop the BA sector. Competition is also coming from Singapore and Malaysia, where investments are being made to develop the business aviation sector, sometimes with substantial government subsidy.

Talent Shortage

A talent shortage is a significant issue in the BA/GA sector of Hong Kong, as it currently relies on professional aviation consultants, pilots, and technicians from Western Europe and North America. Relying on such overseas sources is not sustainable in the long run, as global demand grows nonstop, said Diana Chou, a founder and chairwoman of L’Voyage, a Hong Kong-based business jet charter company. "Ideally, we should nurture more local flight crews to serve our market," she added.

The aviation hub city faces an acute shortage of business aviation technicians and pilots. This is in part due to lack of potential employee awareness of business aviation opportunities. In addition, there is competition for talent from other industries as well as from major and low-cost airlines. Another issue is the requirement for English language skills, and more must be done to improve the language and communication proficiency of entry-level flight crews. Hong Kong lags behind Singapore in this area.

GA/BA aviation firms must be willing to invest in talent management, remuneration, and human resource processes and tools to attract and retain highly skilled manpower. This involves better career-path management, employer branding, and rewarding systems.

A recent study reveals that wealthy but time-poor entrepreneurs in mainland China, Hong Kong, and Taiwan prefer to charter personal jets but they have fewer options than their counterparts in places such as Singapore, Thailand, and Australia. To satisfy this forecast demand, Hong Kong needs to make the younger generation aware of opportunities in the growing business aviation industry.