Okay leases 10 MA60

Okay Airways signed a lease-to-buy contract with AVIC I International Leasing Co. for the purchase of 10 MA60 turboprop aircraft in a deal worth RMB 1.33 billion (about US$175.74 million). The leasing company is a subsidiary of China Aviation Industry Corp. I, while Okay is the first private airline established in China, The first two MA60 will be delivered by AVIC I Xi’an Aircraft Industry (Group) Co. to the airline by the end of the year, the eight others in the next two years. The aircraft will be used by Okay for feeder-line markets in Northeast, Northwest, North and Central China, according to Lin Zuoming, general manager of AVIC. Lin said leasing will also be an important means for AVIC I to market its ARJ-21 regional jet, China’s first self-designed aircraft, which is set to have its maiden flight in 2008 and enter the commercial market in 2009. AVIC I Leasing, established last January, is majority owned by AVIC I. The rest is held by 13 Chinese aviation enterprises and research institutes. International companies hold 90 percent of China’s aircraft leasing market. Okay president Liu Jieyin said China’s Ministry of Finance and the Civil Aviation Administration of China may provide subsidy programs for the MA60. The Chinese government will offer new airlines tax and fee incentives to spur the growth of regional aviation in the country. Okay was first launched in March 2005 and operates three B737 passenger jets, three B737 freighters and two Y-8 general-purpose aircraft. It signed a framework agreement in last year’s Zhuhai Air Show to buy 30 MA60s, the largest single order for the aircraft in China.