U.S. airplane maker Piper Aircraft said Wednesday it will sell more than 150 trainer planes to China’s Sichuan Fan-Mei Aviation Technologies, which runs a pilot training program in the mainland.
Piper Aircraft, which makes small general aviation aircraft and is based in Vero Beach, Florida, will sell 152 planes over seven years in a deal worth $75 million. It includes the sale of 100 Archer TX single engine aircraft that are used to train new pilots.
For the current year, Piper said it planned to deliver 20 planes, with the first delivery starting in March to the Fan-Mei flight school in Sichuan province. The deal was announced at the Singapore Airshow.
Piper President and CEO, Simon Caldecott, told CNBC that Asia has become a key market for the company because there is a growing demand for new pilots in the region.
“One of the things I’ve been looking at, and constantly monitoring, is the global shortage of new pilots,” Caldecott said. He pointed to aircraft maker Boeing’s predictions that Asia Pacific will eventually lead the global demand for pilots.
Indeed, in its 2017 pilot outlook, Boeing said that, by 2036, the Asia Pacific region will have a demand for 253,000 new pilots — about 40 percent of the global demand. Meanwhile, North America is predicted to need about 117,000 pilots and Europe about 106,000.
Overall, Boeing said, the aviation industry would need to supply more than 2 million new commercial airline pilots, maintenance technicians and cabin crew.
“So there’s a big demand, just in Asia, for new pilots,” Caldecott said. “In the past, historically, most of those (pilots) trained in either the U.S., Australia, some in South Africa. But as countries like China develop, they want to train more of their own.”
Don Li, president of Sichuan Fan-Mei Aviation Technologies, told CNBC that the deal with Piper was the biggest ever in the company’s history.
He added that there were plans to order between 40 and 60 additional Piper aircraft over the next two to three years for short-haul air shuttle and personal use — that estimate could also increase according to “how we cultivate the market,” Li said.
The aircraft models that Li referred to — the Piper M-Class and Seneca — are awaiting certification in China at the moment.
As the company is privately owned, Fan-Mei did not receive any government subsidies to make the purchase, Li said.
Sichaun Fan-Mei Aviation Technologies is a subsidiary of Sichuan Fan-Mei Education Group which provides aviation education in China to about 40,000 students. That includes training for flight attendants, aviation mechanics, airport management and security.
On top of the five locations the firm has in China, there are plans to set up in other parts of the country, Li added. Previously, Fan-Mei bought training aircraft from companies like Robinson Helicopters and Bell Helicopter, while Piper is the only fixed-wing company it has purchased aircraft from, Li said.
He added the company was in talks with other companies to purchase different types of aircraft to continue investing in its pilot training efforts.
“This is only the start. We want to become the full-spectrum service provider for the general aviation industry,” he said.