EBACE Convention News

UAS Makes Inroads in China on Deer Jet Alliance

 - May 25, 2018, 2:00 AM
Dubai-based management-charter specialist UAS has exclusive handling rights for Deer Jet’s VIP-configured Boeing 787, the only Dreamliner filling that role.

Fresh from its tie-up with China’s Deer Jet, Dubai-based UAS (Booth B35) has seen an upturn in business and is looking to become further involved in the Chinese market. Deer Jet is a wholly owned subsidiary of the HNA Group, and the alliance with UAS was launched in December 2016. In the lead-up to EBACE the two companies were preparing to make announcements about partnerships and synergies.

In fact, “2017 was the best year ever for UAS in terms of performance, and this can be attributed to the partnership with Deer Jet. Our numbers in terms of revenues and profits increased almost 40 percent, which is remarkable in this business environment. The partnership is very successful,” Mohammed Husary, UAS co-founder and executive president told AIN in the run-up to EBACE.    

“We are now the exclusive global trip support provider for all of their fleet, so business has increased. We have extracted many synergies over the past year, from the general aviation to the commercial side, because they also run commercial airlines.”

The Chinese market looks very promising, he said. “Deer Jet is the air-charter arm [of our new alliance], and we are the flight-support and ground-support arm. There are also synergies with their FBO network. [In addition], UAS has been given exclusive rights by Deer Jet to manage and exclusively charter its Boeing 787, the only [such aircraft] in a VIP charter configuration."

Focus on China and Beyond

“I think the Chinese CAA is very keen to push general aviation, as they see it as an easy way to increase traffic for business, compared to building infrastructure for international airports or investing in airport expansions. Having an FBO can be relatively easier and more straightforward and can ease domestic and international travel,” he explained.

Other opportunities exist with Deer Jet in China and Asia.

“In technology, UAS has launched many products, like UAS Link Evolution, a cockpit and cabin communication product, and UAS Flight Evolution, a flight-planning system. These products are currently being utilized by the Deer Jet fleet. There is a big opportunity to grow that and also pass it on to other airlines.

“In our campaign launch, we ensured the information on all of our products was translated into Chinese to facilitate business there. We brought in our experts from the Houston and Dubai offices.”

Husary said bizav in Dubai is flat today. “Our internal analysis shows that we increased our traffic between 2016-2017. Volume is as big as it used to be, but it’s not growing much. This is the first time there have been charges for landing permits for non-scheduled aircraft in Dubai, and Dubai International Airport seems to get busier every year as Emirates flights increase.

“When you talk about general aviation, the trend now is to use lower-cost aircraft. Those who used to use the BBJs are now using the Gulfstreams and Globals, and those who used to use the Gulfstreams are now using shared jets, like Smart Jet or similar programs. Things are moving more towards less spending. It’s a change in the market. There is a change in spending behavior. Everyone is more cost-conscious.”

He said the UAE GCAA intends to issue new regulations on charter to regulate cabotage. “They want to monitor the empty-leg challenge and extended parking for no reason. There has been a campaign from local operators unhappy that their business is being eroded by foreign operators—the grey market,” he said.

“These operators come from all over the world, basing their aircraft here indefinitely and also marketing them. The local operators are finding it very hard to compete with those who come from abroad, bringing in passengers and overstaying here, and marketing the leg back, thereby depriving local operators of market share. It is a very competitive business in Dubai and the region in general. There are more unofficial players than there used to be, so it is getting more difficult in general.”

UAS has 23 station managers, with 13 in key strategic locations in Africa. These managers are playing a valuable role in improving services for operators there. “Wherever it’s challenging for operators to operate on their own, we like to help them unlock the market.  Competition is increasing, and the infrastructure is improving, as local companies increase in numbers,” he said.

“Senegal is popular because it is geographically located to connect the Americas with the continent. It is even better than Morocco for people coming from South America. Morocco is well suited [to technical and other stops] to North America.”

UAS has seen growth in Japan and Singapore and sees Thailand as another target. “Thailand is one of the destinations we would like to tap into, as we see relatively good opportunity there, especially Phuket, for general aviation. We also have some good customers in Australia, but it is more an outbound destination than an inbound one.”

Given the moves being made by local competitors into the FBO market, Husary said the company prefers to remain asset-light and to avoid the fixed costs involved in heavy investments.

He concluded that the China alliance had been a boon in an increasingly challenging marketplace. “I think the industry is coming close to maturity. Customers are more educated. Competition is increasing. Unless you change the way you do business, you are not going to survive in this industry. That is why we are changing our approach. The next 12 months are crucial. If we get through this period in good shape, then the worst is behind us.”