Aviation

Overview

Aviation (AIR, APG, AVS) Market in Hong Kong

	2010	2011	2012 (estimated)	2013 (estimated)
Total Market Size	587,528	1,732,877	1,452,000	1,535,000
Total Local Production	0	0	0	0
Total Exports	235,239	331,076	347,629	365,000
Total Imports	822,767	2,063,953	1,800,000	1,900,000
Imports from the U.S.	580,194	1,471,215	1,300,000	1,400,000
Exchange Rate: 1 USD	7.8	7.8	7.8	7.8

Notes: 1. Unit: USD thousands.

2. Total Market Size = (Total Local Production + Total Imports) – (Total Exports)

3. Data Sources:

Hong Kong’s market for aircraft and aircraft parts has grown significantly in the last few years due to the increase in aircraft movement, passenger numbers, and cargo volume. Recovering from the aftermath of the global economic downturn with remarkable resilience, Hong Kong International Airport (HKIA), one of the world’s busiest cargo airports, has enjoyed healthy performance. In 2011 HKIA handled 53.9 million passengers, 3.9 million tons of air cargo, and 333,760 total air traffic movements, that is, +5.9 percent, -4.6 percent and +8.9 percent respectively in passenger volume, air cargo throughput and total aircraft movements compared to the corresponding figures in 2010.

While the market environment for the global aviation industry will remain challenging in 2011, the long-term industry outlook for Hong Kong is still very promising. Hong Kong is an international air traffic hub with 100 airlines operating extensive flight connections to 160 destinations worldwide. Many travelers to Asia use Hong Kong as a first stop to other points in the region. Similarly, many mainland China tourists and business travelers make flight connections in Hong Kong for overseas itineraries. Hong Kong is also expected to benefit from the significant growth of aviation industry in the Asia Pacific region.

The Hong Kong Airport Authority is proposing to build a third runway to cope with the expansion of air traffic in Hong Kong. In 2011, the airport handled 53.9 million passengers, already at about 98 percent of capacity. The new runway plan by Hong Kong International Airport will cater to the growing demand.

In terms of air cargo, high-value goods manufactured in southern China are shipped out of Hong Kong, taking advantage of its reliable, transparent, and secure trade and logistics systems. It is also predicted that Hong Kong’s air cargo business will grow from 3 million tonnes of cargo in 2009 to 5.3 million tonnes by 2014. This 12.2% average annual growth is the fastest in the world and will make Hong Kong the world’s second largest international air cargo hub in 2014.

Cathay Pacific firmly believes that it is in Hong Kong’s best interests to take a long-term view to ensure that HKIA continues to thrive. The airline is currently making significant investments to underscore its commitment to the home hub in Hong Kong. It has ordered more than 90 new aircraft with a list price of more than US$23 billion for delivery by the end of the decade. It is also building a US$700 million air cargo terminal that is scheduled to open in 2013, and investing more than $1 billion on new products to give more people a reason to fly to and through Hong Kong

Hong Kong relies entirely on imports of aircraft, aircraft engines, and aviation equipment to meet its needs, as there are no aircraft, engine, equipment or components manufacturers in Hong Kong. Maintenance Repair Overhaul (MRO) and business aviation have been the two major growth areas for Hong Kong in the last few years.

Macau’s gaming sector has also stimulated the city’s long-term air traffic growth, including a sizable increase in business aviation. In 2011, the Macau International Airport handled 39,524 tons of air cargo, a 24% percent decrease compared to the same period of 2009. The airport handled 4.0 million passengers and 38,946 total aircraft movements, which represent a decrease of 0.8 percent and increase of 4.8 percent respectively. These results demonstrate that although Macau’s aviation industry is recovering from the economic downturn from 2009, the near future remains unclear due to the current uncertainty of the economy. However, due to the closer cooperation between Macao and Guangdong province, the air cargo and air traffic is expected to grow steadily in the long term.

Sub-Sector Best Prospects

Opportunities

There are fewer than ten major aircraft components & parts distributors and trading companies in Hong Kong. Most of these distributors also sell to the MRO market and airlines in China and other Asian countries. U.S. aviation industry manufacturers should consider working with Hong Kong based distributors to access markets in China and Asia.

Web Resources

Trade Shows / Exhibitions / Conferences:

The Shanghai International Business Aviation Show
Dates: April 11-13, 2012
Location: Shanghai, China
Website: www.shanghaiairshow.com/

Asian Business Aviation Conference & Exhibition
Dates: March 27-29, 2012
Location: Shanghai, China
Website: www.abace.aero/2012/about/

Aviation Outlook China 2012
Dates: July 10-11 2012
Location: Shanghai, China
Website: www.terrapinn.com/2012/aviation-outlook-china/

Asian Aerospace / Air Freight Asia / Asian Business Aviation
Dates: March 19-21, 2013
Location: Hong Kong
Website: www.asianaerospace.com

Industry Contacts:

Asian Business Aviation Association
Website: www.asbaa.org

HK Airport Authority
Website: www.hongkongairport.com

HK Business Aviation Center
Website: www.hkbac.com

Macau Airport Authority
Website: www.macau-airport.gov.mo/en/index.php

U.S. Commercial Service Hong Kong:
Contact: Ms. Kimmy Lee, Commercial Specialist
Tel: (852) 2521-1467
Fax: (852) 2845-9800
Email: kimmy.lee@trade.gov