Tianjin leads China in plane leasing

Updated: 25 Sep 2014
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Chinese lessors account for 300 passenger jets flown by domestic airlines, or 14 per cent of the mainland's fleet.

 

China's US$400 billion aircraft leasing market is heatting up, with Tianjin emerging as the dominant hub for deals in the rapidly growing sector.

 

An average of 15 aircraft were being delivered every month by leasing companies registered in the northern city's Dongjiang free-trade port (DFTP) zone, said Zhang Zhongdong, deputy director of its administrative commission. Some 409 aircraft had been delivered from the zone since the first transaction in late 2009, with the figure expected to reach 450 by the end of the year, he said. That is equivalent to the fleet size of a major Chinese airline.

"The DFTP accounts for 99.3 per cent of aircraft leasing deals on the mainland," Zhang said.

Forty aircraft have been leased through Shanghai, two from Shenzhen, and two via Xiamen, which are other pilot zones permitted to conduct aircraft leasing with preferential policies.

The mainland's aircraft leasing market was dominated by foreign lessors until 2007, when state-owned banks were allowed to own leasing subsidiaries and rapidly increased their market share. Chinese lessors now accounted for 300 passenger jets flown by domestic airlines, or 14 per cent of the mainland's total fleet of more than 2,000 aircraft, said Tao Mei, vice-president of ICBC Financial Leasing, which accounts for 107 aircraft, making it the largest player in the domestic market.

Boeing forecasts China will need more than 6,000 passenger jets worth US$870 billion in the next 20 years. "At least 50 to 60 per cent of that will be financed through leases," Tao said.

Increasingly, domestic lessors not backed by state-owned banks are also eyeing a share of the market, while more established operators look overseas to diversify their financing sources and lessee bases.

ComSys Leasing, a small aircraft and engine leasing company backed by Hong Kong capital, last week announced plans to buy 20 ARJ-21 aircraft from Comac - China's homegrown manufacturer of a regional jet that is still under testing. With no direct affiliation with airlines or banks, ComSys started operating in Tianjin's DFTP in 2011 and had leased more than 30 aircraft to mainland airlines, company president Cheng Gang said. "During the financial crisis and the US credit crunch, many foreign lessors were phasing out of the Chinese market and we saw the opportunity," Cheng said.

The company's portfolio consists mainly of narrow-body Boeing and Airbus aircraft bought from airlines. Cheng said the decision to add the smaller ARJ-21 - with its delivery date unknown - to its fleet stemmed mainly from a wish to "to support Chinese homegrown aviation and because we see market demand for regional jets".

Enwright DeSales, a senior partner with Deloitte, said that for the more established Chinese lessors, Ireland - the world's main aircraft leasing centre with various tax benefits - remained the most preferred platform, followed by Singapore.

ICBC Leasing, which has nearly half of its 200 delivered aircraft leased to customers outside China, has set up a Dublin subsidiary to manage more of its business from the Irish capital.

China Development Bank Leasing, with a fleet size of 185, and Bank of Communications Leasing, with 70 aircraft, have also started to do that. Bank of China's BOC Aviation, the most international Chinese lessor, has always operated out of Singapore as it was a Singaporean leasing firm with two decades of operations before it was acquired by the Chinese lender in 2006.

 

SOURCE: www.scmp.com

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Comments Area ( Total Comments: 1 )
charleswbaer Commented on 30 Sep 2014

charles webster baer
tianjin china
september 30th , 2014

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how . thats short for nee how , which means hello in chinese . also , after saying she she for four months , I found out that thank you is sheh sheh . so , no more she she , now its all sheh sheh . and when I say sheh sheh the response is usually KUSH . so I think kush means your welcome . I now have a week off because october one through seven is NATIONAL DAY . so this week we celebrate the communist government of the peoples republic of china . party on . teaching is going great . on monday I have two classes in the morning . on tuesday I have one class in the morning . each class is an hour and a half . on wednesday I have one class in the morning and one at night . on thursday and friday I have two classes in the morning and one in the afternoon . so , busy next three months . I am teaching my classes about the united nations and the international monetary fund and about transparency so I am teaching them about stuff that I find important . my classes are like 90% female so Im not sure why that is . this is military month so everyone is dressing up in camo , the guys in the usual green camo , the girls in this blue white camo . not really sure where you can go and blend in in blue and white . so may is the month when I re negotiate my contract . now there are many ways to do this . some legal , some illegal , some semi legal , etc . I have my company , and they are getting paid by the university , as they should . however , when my year contract is up with them , then what . do they own me , slave style , forever , when I teach in china . Im not sure about this , but I am curious . and even if they do , apperantly , I can just tell them Im going home to the usa , then change my mind and stay and become a free agent or whatever . so , I will be looking into all these possiblities next year . one thing is for sure , Im going to get a big raise and less hours here or Im going to go to another part of the country . the weather is now nice and cool . have not been able to say that since I was in oregon . me and john gordon are set to clash on chess.com shortly . my status as supreme allied chess chief is not in jeopardy because all tie\'s go to the world champion ( me ) . I have a flash drive so , in theory , I can take stuff off you tube and show it in my class , so , I may get into that . because china is getting heavy into the united nations and the international monetary fund , china is a world leader , and I get into this in my classes , and everyone gets really pumped up , like , yeah , china , world leader , etc . so thats fun . then we get into transparency and female reproductive rights and stuff and its this huge charles webster baer and china save earth propaganda freak show . I love it . and they learn english . so everyone has a good time . so , practically all my students are female sophmore english majors . we watched CASABLANCA last week and that was cool . what a movie . I cant really play my conga because everyone is in class . but now I can play it all week long . I cant tell if my turtle is hibernating or dead , and , frankly , I dont really care anymore . if he starts to smell its into the trash . this concludes turtle news . following football and baseball without watching it , and all news for that matter , is a far more intellectual pursuit . much more cerebral . almost abstract . open to deeper analysis on a sub concious level . slows it down for a better perspective . more detatched , and thus , clearer . if you not personally involved in a concept , such as , say , america , you can gain a better understanding . I have actually considered coming back to america just to buy some chewing tobacco and then return immediately to tianjin . arnel\'s black american friend jerome will be here for a week so it will be good to see a fellow yank . you guys dont understand , I am the ONLY white person on this campus of 17,000 and it seems like Im the only white person in this town of 11 million . Im not kidding . there are no white people in china . no australians , no canadians , no europeans , nothing . there is a handfull of black people but they are from africa . china can communicate with the world with the english language and with each other with this top secret code called the chinese language . so only china can communicate with everyone . I dont even have enough money to get drunk any more . so , I guess that is good news . a few weeks ago I got up at 7am and read the poem THE ROAD LESS TRAVELED to a few hundred chinese students dressed in military uniform , twice . that was fun and bizarre . I also judged a second english contest . the first one had a chick in it who was the only one who answered the question they were all talking about . how do you change the unchangeable . everyone was babbling on about perservieriance and believing in yourself and that kind of drivel . this chick said , change the meaning of the word unchangeable to changable . so , instead of asking her a question I just turned around on the mic and faced the croud , this was the finals so there was like three hundred people or whatever , and I said , this is the only person who answered the question . everyone loves my dreads . my students ask me to sing them a song so I sing them lido shuffle by boz skaggs . the food is really good but thats probably because its september and everyone is havesting all the fresh vegtables and there is plenty of them etc . I will have time to tutor off campus in january and febuary so I can make some extra cash that way . it seems that my only physical connection with the life I use to know is a cold plastic bottle of coke a cola . here it is spelled OJOOJ4 . dont ask why because I dont know . if its you vs. twenty women who want to watch a movie your gunna lose so yesterday we watched a chinese movie a chick had on her flash drive about a chinese woman and her kid . every class I have those students who just cant or wont say anything . some people have advised me to ignore those people , but , Im not going to do that . my classes are small enough that I can talk to every student and silence just wont cut it in my class . every student stands up and says something . if they dont have anything to say I give em something to say . my washing machine plays jingle bells when its done . my epic struggle against the mosquito invaders seems to be subsiding . so I get paid on the 15th of every month . the key to this is getting the reciept and have the ballance be on it . so , when my food card runs out of food point on october 18th , I will hit up my china construction bank atm , there are four of them withing a four block radius , and now I have cash to eat . and cash to buy soap . the good life . things become very simple when your broke . and healthy . from tofu to kong fu . I told a japanese guy sianara yesterday . ok peeps , thats all I got . cwb out .
  

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