Wealthy people in Japan are turning to private jets in greater numbers as they seek to eschew crowded airports amid the ongoing coronavirus pandemic.
The push means that ANA Holdings Inc.’s private jet charter business is expecting sales of ¥1 billion in the 2022 fiscal year, Jun Katagiri, the chief executive officer of ANA Business Jet Inc., said last week. ANA Business Jet is owned jointly by ANA and trading company Sojitz Corp.
Inquiries for private charters are running at about 20 a month, up 30% on pre-pandemic levels, according to Katagiri. “This will be a new option for transportation,” he said, declining to disclose past years’ sales.
Compared to Europe or the U.S., Japan is a small market for private jet operators, in part because domestic transport is quick and efficient, and the nation is relatively small in size. But there has been a rise in business people wishing to come to Japan from other countries who are flying private, as well as Japanese stuck overseas wanting to come home and who haven’t been able to secure regular flights due to COVID-19.
In 2019, the number of wealthy households in Japan reached 1.3 million, the highest since 2005, with net financial assets hitting ¥333 trillion, according to the Nomura Research Institute. Their ranks are increasing due to former Prime Minister Shinzo Abe‘s ultra-easy monetary policy.
It costs about ¥39 million for a round trip from Tokyo to New York on a jet with 13 seats, and ¥30 million to fly to Los Angeles and back. Hiring a private plane for a round trip to Beijing from Japan’s capital will set you back ¥15 million.
ANA Business Jet doesn’t own any planes itself, bringing costs down. Rather it works with around 40 operators globally to arrange flights, which also allows the group to be more nimble.
The world’s business jets market is forecast to expand to to $38 billion by 2030, up from an estimated $19 billion in 2020, according to Markets&Markets.
ANA reported a loss of ¥81 billion for the three months ended Dec. 31, while sales fell 55% to ¥236 billion. “I’m glad we aren’t owning assets during the coronavirus,” Katagiri said.
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