Airbus Triples Chinese Corporate Jet Sales as Local Market Booms

Airbus SAS predicted it will more than triple the fleet of corporate jets operating in China by the end of this year and plans to expand sales points in the country as it seeks to win business from government.

The company will have delivered 17 aircraft to China by the end of 2012, compared with five operating in the country at the end of last year said Francois Chazelle, vice president at Airbus’s corporate jets division. The company has teamed up with a local interior aircraft outfitter, he said.

“It’s growing fast and we’re doing very well in China,” Chazelle said in an interview ahead of the National Business Aviation Association’s annual conference in Florida. “We’re investing in China. We have offices in Hong Kong and Beijing, and we’re growing our offices here.”

China has become one of Airbus’s biggest markets for its commercial airliners configured as VIP jets. While the dozen or so business planes that Airbus typically sells a year represents but a fraction of those sold for commercial passenger service, margins are higher on private jets, which often feature meeting rooms, VIP suites and showers.

Airbus has delivered a total of 170 corporate jets so far, of which 110 were narrow-bodies of the A320 family. Airbus won a contract in 2007 from Saudi billionaire Prince Alwaleed bin Talal for an A380 double decker. The plane has been built and is awaiting delivery.

Airbus normally offers business-jet customers the choice of eight preferred cabin suppliers, including Lufthansa Technik and Jet Aviation AG in Europe and Associated Air Center LP and Comlux Aviation Services LLC in the U.S. To sell to the Chinese government, Airbus teamed up with Taeco, an aircraft maintenance company in Xiamen, eastern China to outfit cabin interiors, Chazelle said.

Selling to the government has become a delicate task after authorities discovered listening devices in 2001 on board a Boeing Co. (BA) 767 destined for then-President Jiang Zemin. Boeing said the bugging didn’t happen at the company. Chinese authorities subsequently ripped out the interior and gave the plane to a commercial airline for regular passenger service.

Airbus has sold business jets to more than a dozen governments including France, Germany, Brazil, Qatar and Italy. Some governments choose not to be identified as customers.

To contact the reporter on this story: Andrea Rothman in Toulouse at aerothman@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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