China swoops on flight schools to solve pilot shortage

[fly_tornado]

China swoops on flight schools to solve pilot shortage

 

 

Aminta Hennessy of Clamback & Hennessy at Bankstown. Picture: John Feder

 

• The Australian
   
   
  
•  
   
   
  

 

 

Chinese companies are swooping on Australian flight training schools increasingly stricken by skyrocketing costs and crippling red tape, amid predictions that the nation will be forced to import scores of commercial pilots from Asia and Africa in coming years.

 

The Weekend Australian has spoken to several of the country’s 350 aviation training businesses that say they are unprofitable and are considering selling to the Chinese. Scores of local firms have folded in recent years and several of the larger schools are now foreign-owned.

 

China will need an estimated 110,000 new pilots by 2035 but is relying on other countries for most of its training because of its heavy smog, military-controlled airspace and lack of qualified teachers who speak English.

 

A federal government report this week confirmed the local industry’s drastic decline, showing the number of general aviation flying hours in Australia fell by 40 per cent — from 500,000 hours a year to 300,000 hours a year — between 2010 and 2015.

 

The increasing foreign ownership in the flight training industry — particularly the concentration of Chinese acquisitions — is raising concern among senior security experts.

 

Peter Jennings, the executive director of the Australian Strategic Policy Institute, said the “aggregation effect’’ could be of the same concern in flight training as it had been to Scott Morrison in other sectors.

 

“It may be acceptable to own one or two flight training schools,’’ Mr Jennings said, but if the Chinese acquired flight training schools to the point where there was a dependence on it, “the aggregation effect of that could be negative from a government perspective’’. Flying training is seen as vital to allow Australia to keep up with the increasing demand for pilots, with predictions of a major shortage in coming years.

 

 

The landmark study by the Bureau of Infrastructure, Transport and Regional Economics also raised industry fears about the cost of pilot and maintenance training, soaring airport charges and recent regulatory changes that were “not supported by adequate justification”.

 

Aircraft Owners and Pilots Association chief executive Ben Morgan said he believed more than 50 per cent of all flight training in Australia was now being carried out by foreign companies, and most of them were Chinese.

 

He said it was “realistic” to predict the industry could be entirely foreign-owned in the next 10 years. “The Chinese are cleaning up,” he said. “Australia is selling out its flight training industry to foreign interests.”

 

Chinese airlines have been investing heavily in Australian flight training in recent years. In 2015, a China Eastern Airlines subsidiary bought a 50 per cent stake in CAE’s Melbourne training school. Its rival, China Southern Airlines, owns 50 per cent of a West Australian academy.

 

One of the biggest regional schools, Australian International Aviation College in Port Macquarie, is now owned by Hainan Airlines after the local operator ran into financial trouble in 2014.

 

The Chinese sale was facilitated by the federal government’s Austrade agency. The business is now planning an $18 million training facility at Kempsey airport to train Chinese students.

 

Dick Smith, a former chairman of the Civil Aviation Safety Authority, blamed the destruction of the industry on the former Howard government’s directive to CASA to ignore costs in relation to air safety, which he said had led to the adoption of the world’s most expensive regulations.

 

“Australian companies are going broke because of paperwork and red tape,” he said. “Now we have a shortage of pilots. Does it matter that in five years … we will have pilots from developing countries — from India, Indonesia and China — flying our airlines?”

 

Mr Smith said he was also concerned that Australian flight training companies were unable to get approval from China to train Chinese students, in the same way Chinese-run schools do in Australia.

 

Mr Morgan, of AOPA, welcomed the appointment this week of Barnaby Joyce as Transport Minister and called on him to urgently address how the local flight training industry could deliver crews for Australian airlines rather than relying on Asian and African pilots.

 

He said CASA should allow independent flight instructors to be used by smaller businesses, noting that 70 per cent of training in the US was conducted by independent instructors.

 

“If you are not an organisation with a bucket of cash, there’s no way you can get involved in flight training,” he said.

 

“We used to be a leader in flight training but we have created an expensive and cumbersome system.”

 

A CASA spokesman said the concept of independent flight instructors was raised during consultations but was not widely supported at the time.

 

“If the aviation community believes the concept of independent instructors needs to be looked at again, CASA is willing to listen to constructive suggestions,” he said.

 

Industry veteran John Douglas, the former head of the Royal Aero Club of WA, said conditions were the worst he had seen in 50 years.

 

He said the number of training hours a year at the club had fallen from 36,000 hours a year to 16,000 over the past two decades.

 

Mr Douglas slammed new CASA requirements for schools to spend money to gain new certification for training. “The cost of compliance is killing the industry,” he said.

 

Bill Whitworth, the owner of Whitworth Aviation at Bankstown Airport, recently agreed to sell his troubled business to a Chinese company. “They want to get a foothold here at Bankstown Airport,” he said. “They want to bring students down and train them, starting with 30 students.”

 

Mr Whitworth, who has been teaching flying since 1965, said his decision to sell was driven by soaring costs and changes to the system of government loans for students.

 

Another long-term operator at Bankstown, Aminta Hennessy, said businesses were also being hurt by rising airport fees and charges.

 

She said she had been recently approached by foreign companies to sell.

 

The chief executive of Melbourne Flight Training, Glen Buckley, said he had received five offers from Chinese companies to buy up to 20 per cent of his business, but he had so far resisted the temptation to sell.

 

Additional reporting: Sid Maher

 

 

[Old Koreelah]

China swoops on flight schools to solve pilot shortageChinese companies are swooping on Australian flight training schools increasingly stricken by skyrocketing costs and crippling red tape, amid predictions that the nation will be forced to import scores of commercial pilots from Asia and Africa in coming years...

Dick Smith, a former chairman of the Civil Aviation Safety Authority, blamed the destruction of the industry on the former Howard government’s directive to CASA to ignore costs in relation to air safety, which he said had led to the adoption of the world’s most expensive regulations.

 

“Australian companies are going broke because of paperwork and red tape,” he said. “Now we have a shortage of pilots. Does it matter that in five years … we will have pilots from developing countries — from India, Indonesia and China — flying our airlines?”

 

Mr Smith said he was also concerned that Australian flight training companies were unable to get approval from China to train Chinese students, in the same way Chinese-run schools do in Australia...

Another triumph for the Howard government?

 

 

[fly_tornado]

the chinese gov doesn't want foreign pilots taking all the good paying pilot jobs, that's how communism works.

 

 

[Downunder]

I hope the govt doesn't do a "Holden" and simply throw money at aussie owned schools to keep them viable.

 

If the schools form their business plan revolving around predicted losses and bailout money it won't end pretty for anyone.

 

 

[old man emu]

the chinese gov doesn't want foreign pilots taking all the good paying pilot jobs, that's how communism works.

That comment is way off target. China has, in recent years, "demilitarised" is air space for use by civilians. With the growing wealth of individual Chinese people (look at the number of Chinese tourists travelling the world) the use of previously prohibited airspace is increasing. Not only are the Chinese buying into flight training here, they are also buying into our light aircraft manufacturing industry. They are following the post-WWII Japanese example and reverse engineering the products of other Nations. How 50-50 do you think Brumby's arrangement with the Chinese really is? I don't see Brumby calling out for workers to make their planes in Cowra.

 

 

[fly_tornado]

I don't think that the GA sector will ever be that big an industry in China, airlines and air freight are considered critical industries. the west can supply as many ATPL pilots as the Chinese need but the Chinese don't want that.

 

 

[Downunder]

How 50-50 do you think Brumby's arrangement with the Chinese really is? I don't see Brumby calling out for workers to make their planes in Cowra.

Brumby just needs to look at how the chinese copied the Russian fighters....

 

Built some under licence, then they reverse engineered everything, and stopped paying the Russians...

 

 

[old man emu]

I hope the govt doesn't do a "Holden" and simply throw money at aussie owned schools to keep them viable.

If the Government diverted the money CASA wastes on destroying Australian aviation through the "Death by a Thousand Cuts" to bolstering Australian initiative in this area, then the schools would be rejuvenated.

 

If the schools form their business plan revolving around predicted losses and bailout money it won't end pretty for anyone.

But these small businesses want to develop their business plans based on the income they can generate by conducting there core business activities minus the costs of conducting that core business. It is CASA and a hundred other State and Federal departments that are ballooning the cost side of the equation.

 

Another thing that has struck me when I deal with small businesses is that people who are good at some task set up a business to carry out that task, but have no idea how to manage the business with a view to promoting its growth, or even to maintain its status quo.

 

 

[old man emu]

C'mon Yenn. Which bit of Post # 8 did you like?

 

 

[phonetic]

Im sure regional shires with a aerodrome would love to get a slice of the business makes good sense for ab initio training, like a converted shed donger for class room and dozen Tecnam P92 would churn through 300 students per year with lots of landing & traffic fees ??

 

I can see some small RAA GA schools do deals with the larger training schools to offer ab initio training roles & tasks

 

 

[spacesailor]

I don't think that small aircraft are really wanted in the present administration, bigger heavier factory produced expensive aircraft are accommodated,

 

Seems, all want GA aircraft on RAA register as a cheaper way to fly recreation.

 

spacesailor

 

 

[Bernie Knight]

I guess we all know some young pilot who is trying to get enough hours to obtain that dream job in the airline industry.

 

They are hangar rats for their early years, then they progress into the training arena prior to taking various jobs to get those wanted hours - many end up doing tourism or delivery jobs to obtain those hours.

 

If we are serious we need to have a path to better assist their progression.

 

 

[M61A1]

Brumby just needs to look at how the chinese copied the Russian fighters....Built some under licence, then they reverse engineered everything, and stopped paying the Russians...

Seems to be quite common....patent, what patent? They've done it with everything from asphalt plants to aircraft.

 

 

[KRviator]

I guess we all know some young pilot who is trying to get enough hours to obtain that dream job in the airline industry.They are hangar rats for their early years, then they progress into the training arena prior to taking various jobs to get those wanted hours - many end up doing tourism or delivery jobs to obtain those hours.

 

If we are serious we need to have a path to better assist their progression.

So the Rex and Qantas and other cadet schemes don't count?Personally, I do not mind the various airline cadet schemes, despite the howls of protest among various pilot groups. There is stuff-all benefit to flogging around the territory at low level in a clapped-out 210 that can compare to piloting a 737 in the flight levels vs a properly trained cadet. One could argue there are many detriments to it, in terms of a willingness to bend the rules to keep the boss happy lest he give you the boot for writing up a bunch of gripes after each flight...The only operator likely to benefit from such experience is the RFDS...

 

 

[Yenn]

there is an interesting article in Australian flying about a way to overcome some of the problems of CASAs new regs. for flying schools.

 

 

[Patricia Leigh]

China swoops on flight schools to solve pilot shortageAminta Hennessy of Clamback & Hennessy at Bankstown. Picture: John Feder

 

• The Australian
   
   
   
  
•  
   
   
   
  

 

 

 

Chinese companies are swooping on Australian flight training schools increasingly stricken by skyrocketing costs and crippling red tape, amid predictions that the nation will be forced to import scores of commercial pilots from Asia and Africa in coming years.

 

The Weekend Australian has spoken to several of the country’s 350 aviation training businesses that say they are unprofitable and are considering selling to the Chinese. Scores of local firms have folded in recent years and several of the larger schools are now foreign-owned.

 

China will need an estimated 110,000 new pilots by 2035 but is relying on other countries for most of its training because of its heavy smog, military-controlled airspace and lack of qualified teachers who speak English.

 

A federal government report this week confirmed the local industry’s drastic decline, showing the number of general aviation flying hours in Australia fell by 40 per cent — from 500,000 hours a year to 300,000 hours a year — between 2010 and 2015.

 

The increasing foreign ownership in the flight training industry — particularly the concentration of Chinese acquisitions — is raising concern among senior security experts.

 

Peter Jennings, the executive director of the Australian Strategic Policy Institute, said the “aggregation effect’’ could be of the same concern in flight training as it had been to Scott Morrison in other sectors.

 

“It may be acceptable to own one or two flight training schools,’’ Mr Jennings said, but if the Chinese acquired flight training schools to the point where there was a dependence on it, “the aggregation effect of that could be negative from a government perspective’’. Flying training is seen as vital to allow Australia to keep up with the increasing demand for pilots, with predictions of a major shortage in coming years.

 

 

The landmark study by the Bureau of Infrastructure, Transport and Regional Economics also raised industry fears about the cost of pilot and maintenance training, soaring airport charges and recent regulatory changes that were “not supported by adequate justification”.

 

Aircraft Owners and Pilots Association chief executive Ben Morgan said he believed more than 50 per cent of all flight training in Australia was now being carried out by foreign companies, and most of them were Chinese.

 

He said it was “realistic” to predict the industry could be entirely foreign-owned in the next 10 years. “The Chinese are cleaning up,” he said. “Australia is selling out its flight training industry to foreign interests.”

 

Chinese airlines have been investing heavily in Australian flight training in recent years. In 2015, a China Eastern Airlines subsidiary bought a 50 per cent stake in CAE’s Melbourne training school. Its rival, China Southern Airlines, owns 50 per cent of a West Australian academy.

 

One of the biggest regional schools, Australian International Aviation College in Port Macquarie, is now owned by Hainan Airlines after the local operator ran into financial trouble in 2014.

 

The Chinese sale was facilitated by the federal government’s Austrade agency. The business is now planning an $18 million training facility at Kempsey airport to train Chinese students.

 

Dick Smith, a former chairman of the Civil Aviation Safety Authority, blamed the destruction of the industry on the former Howard government’s directive to CASA to ignore costs in relation to air safety, which he said had led to the adoption of the world’s most expensive regulations.

 

“Australian companies are going broke because of paperwork and red tape,” he said. “Now we have a shortage of pilots. Does it matter that in five years … we will have pilots from developing countries — from India, Indonesia and China — flying our airlines?”

 

Mr Smith said he was also concerned that Australian flight training companies were unable to get approval from China to train Chinese students, in the same way Chinese-run schools do in Australia.

 

Mr Morgan, of AOPA, welcomed the appointment this week of Barnaby Joyce as Transport Minister and called on him to urgently address how the local flight training industry could deliver crews for Australian airlines rather than relying on Asian and African pilots.

 

He said CASA should allow independent flight instructors to be used by smaller businesses, noting that 70 per cent of training in the US was conducted by independent instructors.

 

“If you are not an organisation with a bucket of cash, there’s no way you can get involved in flight training,” he said.

 

“We used to be a leader in flight training but we have created an expensive and cumbersome system.”

 

A CASA spokesman said the concept of independent flight instructors was raised during consultations but was not widely supported at the time.

 

“If the aviation community believes the concept of independent instructors needs to be looked at again, CASA is willing to listen to constructive suggestions,” he said.

 

Industry veteran John Douglas, the former head of the Royal Aero Club of WA, said conditions were the worst he had seen in 50 years.

 

He said the number of training hours a year at the club had fallen from 36,000 hours a year to 16,000 over the past two decades.

 

Mr Douglas slammed new CASA requirements for schools to spend money to gain new certification for training. “The cost of compliance is killing the industry,” he said.

 

Bill Whitworth, the owner of Whitworth Aviation at Bankstown Airport, recently agreed to sell his troubled business to a Chinese company. “They want to get a foothold here at Bankstown Airport,” he said. “They want to bring students down and train them, starting with 30 students.”

 

Mr Whitworth, who has been teaching flying since 1965, said his decision to sell was driven by soaring costs and changes to the system of government loans for students.

 

Another long-term operator at Bankstown, Aminta Hennessy, said businesses were also being hurt by rising airport fees and charges.

 

She said she had been recently approached by foreign companies to sell.

 

The chief executive of Melbourne Flight Training, Glen Buckley, said he had received five offers from Chinese companies to buy up to 20 per cent of his business, but he had so far resisted the temptation to sell.

 

Additional reporting: Sid Maher

I just wrote to my member of Federal Parliament and suggest others do the same, I am not a politician and am thinking about how can we do this better, if you have better ideas, you write to your local Member of FP and say what you think.

I said

 

From what I am now learning about the Constitution, Legislative powers of Parliament, are there to make laws for the peace and order and good government of the Commonwealth with respect to the 39 points listed. And if the government is not representing our views and culture we the people change that by a majority vote and process.

 

Re: Point 1, 3, 20: I am concerned with the reports that our Aviation Schools are not profitable and businesses are folding and China is swooping in to purchase these, this is not good order and good government for the Commonwealth. Rules should quickly be made to ensure that any foreign business does not compete to overrun us and pose a threat to our country. We should be smarter than this and use investment opportunities to boost ours. Foreign countries should not OWN the business but may obtain some benefits from boosting Australian own businesses and form up to 40% of a board through their investment in the industry, and should assist to make affordable the training of Australian Piolets, so that the percentage of Australian trained pilots in any academy exceeds 50% of those trained in an industry that is out of the reach of most Australians to afford to train in. That is just a thought at the moment but come on you guys keep this country safe and get smarter at making ways for the people to thrive in this country.

 

So come on Australians talk to your Parliamentary representatives and say this is not what we want.

 

 

[Yenn]

I have talked to my parliamentry representative many times and all that happens is that he pushes my query to the relevent minister, who responds with words to the effect that he doesn't give a stuff and I can go and get lost. At over eighty years of age I am just about fed up with the Australian government. A great pity as we have a lovely country and lovely people. But the government is absolutely useless. I would go live in New Zealand, but I don't think I could take the cold weather. Maybe I can last my few remaining years in comfort, but it is time for younger people to rectify the wrongs of all those governments since the Keating era.

 

 

[phonetic]

Australian airlines really have the pick of the crop to hire as junior aircrews , ATPL theory with bachelor and diploma degrees from academies or ex ADF aviators, with out either how does a bare bones CPL actually get to advance ??

 

 

[Guest Guest]

Australian airlines really have the pick of the crop to hire as junior aircrews , ATPL theory with bachelor and diploma degrees from academies or ex ADF aviators, with out either how does a bare bones CPL actually get to advance ??

They don't, sadly Australia is just a backwater now for the supply of pilots -:(

 

 

[spacesailor]

Same thing applies in the UK, my nephew had to go to NZ, to get a commercial piloting job, from England!. A couple of years at the other side of the world, was enough time away from his family, & not even a trip to Sydney for a visit.

 

spacesailor