Flying high: Private aircraft demand soars in the Philippines

Businessmen prefer to own private aircraft such as Citation jets and Bell helicopters amid the pandemic. — COURTESY OF PHILJETS GROUP

By Arjay L. Balinbin, Senior Reporter

DEMAND for private aviation services in the Philippines is growing amid a coronavirus pandemic that has battered commercial airlines.

Aviation solutions company PhilJets Group has seen a 20% increase in aircraft sales in 2020, helping it stay afloat despite the crisis.

“Yes, for new owners, we have more demand… We did sell more aircraft in 2020, by 20% more than in 2019,” PhilJets Chairman Thierry Tea told BusinessWorld in a recent phone interview.

Business travelers have turned to private flights due to concerns over the coronavirus disease 2019 (COVID-19) and limited commercial flights as many airlines downscaled operations.

“Basically, they are business people who need to fly for business or other activities,” Mr. Tea said.

Citation jets and Bell helicopters are among the most preferred aircraft because they are “low-cost, cost-efficient, low maintenance aircraft,” he said.

The price of the five-seater Bell 505 alone, depending on the equipment, is around $1.7 million.

There were about 1,200 business jets and 4,000 helicopters in Asia, with China leading the market and the Philippines having about 200 helicopters and 50 jets as of November 2020, according to PhilJets.

“We already closed some deals this year. This is for Bell 505, which is in high demand,” Mr. Tea said.

“The demand is driven by the US market basically, but Asia is coming stronger as well. It is starting to recover quite fast. The demand is rising in China, and the big jets are less in demand. The demand is more on the medium-sized jets,” he explained.

PhilJets lost more than 20% of its overall business in 2020, with the charter segment contributing the most due to travel restrictions.

“We lost more than 50% of our charter business,” Mr. Tea said. “It was a very challenging time for us, especially in the first three to four months of the year.”

PhilJets is engaged in distribution and sales of components, spare parts, consumables, software, and tooling equipment for the aviation industry. It is also engaged in aircraft trading and maintenance, repair, and overhaul services.

“If we were only doing a charter business, probably we’re already dead or bankrupt,” Mr. Tea noted.

The company was able to secure more partners despite the pandemic.

“We have partnerships with a few other brands, especially for maintenance. We are finalizing a few partnerships,” Mr. Tea said, adding that PhilJets is also working on a partnership with Yugo, a private aviation network.

Digitalization is what Yugo, a digital platform, would bring.

“It already started to get Philippine members. It’s not yet officially launched in the Philippines, but it’s already getting quite a lot of traction, and they will be opening an office in Manila pretty soon,” he said.

Mr. Tea said PhilJets’ partnership with Yugo, which has presence in Asia, Europe, North America and the Middle East, should “raise the standards for business aviation in the Philippines.”

The company does not expect air traffic to go back to pre-pandemic levels right away after the COVID-19 vaccine rollout.

“Even with the vaccine, people will not fly right away,” Mr. Tea said. “We are looking at 2024 before air traffic will return to normal.”