Sichuan Airlines is preparing the launch of a new business jet joint venture with European Flight Services despite the decline in domestic demand that has accompanied surging fuel prices. Shanghai-based Genesis Investment Management also is expected to be a stakeholder in the new company, which will be named EFS Asia Pacific and will adopt the Legacy 600 as its main fleet type. A Sichuan spokesperson said that there "is no specific timetable" for launch.

Although CAAC implemented a regulation last summer denying approval to new entrants before 2010, the joint venture should be granted an exception because it will be based in Chengdu in western China. CAAC said it would consider new carriers operating domestic aircraft or those based in the west or northeast. Business aviation remains a nascent market in China and domestic business jet companies have suffered from a collective operating loss in recent years largely because business jets are taxed far more heavily than commercial aircraft. Pilot shortages, insufficient airport infrastructure and difficulty securing routes also are to blame.