How Aero Lab International Inc. Confronts Japan’s Aviation Challenges and Pushes for Industry Reform

Japan’s manufacturing has evolved to a very high level of technology and precision with a strong attention to detail, from traditional monozukuri manufacturing to cutting edge methods. Despite this, Japanese manufacturers are not well known in the aviation industry. Can you provide your comment on the Japanese aviation market and its current contributions to global markets?

Our company is not a manufacturer. We maintain, buy, and sell. For those activities, we don’t have any other professionals in Japan doing that, so someone wants to import an airplane. There used to be a small number of companies—maybe around twenty—selling small airplanes and jets, but they weren’t professionals, so they had to work with the Japan Civil Aviation Bureau (JCAB), which is like the Japanese FAA. Actually, they also don’t know what to do, so nobody knew. That’s why we started this company.

Now, we know how to import, how to fly, how to maintain, and how to register. We know about that, but as to your question about manufacturing, Japanese companies are involved in making wing spars, fuselage, avionics, etc., but they only know how to make those things because they have the blueprint. They can make whatever the blueprint specifies, but they cannot create the airplane. So, perhaps I’m not supposed to say this, but I think Japanese aviation manufacturing is done. The same is true for Korea and even the US.

For example, in the case of the Honda Jet, Honda is just investing the money. The engine is a US company, and the fuselage is a US company. Everything is from US companies. Of course, they have a lot of ideas and maybe they can design a new wing or new avionics, and maybe they used to be capable, but at this point we have super strict aviation laws, which are really impediments because the rules were made like 50 years ago and are still the same.

Do you think that the current bureaucracy surrounding the industry stifles innovation and progress?

It has to change, but the people working at the JCAB, the government side, don’t really know what to do right now. We are trying. They already changed a couple of aviation laws because we talked to them, complained to them, explained to them, and trained them. We do a lot, but it’s not good enough, and our company is the only one in this country that talks to JCAB like this because if others talk strongly about something to JCAB, they will shut down the business. It’s really bad, old-school stuff. That’s what’s happening in Japan, so ShinMaywa or Mitsubishi have been making the same things for maybe 20-30 years. They are making it cheap, but I see China and Russia making better stuff right now, so I don’t think Japan can survive with that kind of competition.

Looking at the global perspective and the aviation environment, Trump has enacted more policies and restrictions regarding the imports of various countries, including Japan and China. How do you assess the effects of such policies on your business and what are you doing to navigate them in the best way possible?

We are selling airplanes made in the US, so if we import from the US, the Japanese government will not put some extra taxes on that. And when we export to the US, which we also do, we are exporting planes made in the US, so they are not subject to those tariffs. Even for parts we need to exchange and send back to America, the people who are importing them in the US don’t have to pay any tariffs because they are originally from the US.

As for Japanese technology, it has to change. The aviation industry is now on the edge in terms of technology. The US is in the same situation. We are also doing a spaceship program now and everything is going to be autopilot, but that’s super difficult to do because you have to account for every scenario. We are using the technology from rocket navigation systems, but everybody has seen the DJI drones, and those little drones are doing more than actual rockets. Those are made in China with small chips, but we need larger chips to do the same thing. Our products are stupid compared to theirs, so I think we cannot match them. Because of this, I think the US and Japan are losing the aviation game.

Who will the winner be?

China, and I don’t want to say it, but North Korea also, because their navigation is good. Of course, if you’re talking about shooting down missiles, the US and Japan can both do this, but we need a control room with hundreds of computers. China and North Korea can do this with just a laptop, so it’s a different technology playing field. Aviation needs to move to that technology. If you look at airplanes, they have a lot of instruments. Even a small airplane has a minimum of USD 500,000 of instruments installed with lots of wires, but you know what? My iPhone can do the same thing, so we have to change.

The technology development, especially for commercial aircraft, is something I find very interesting, especially comparing Airbus with Boeing. Of course, the 737 was the world’s most popular airplane for many decades, but then they didn’t adopt the fly-by-wire (FBW) technology and they were too slow with regulations, and now Airbus, which started much later than Boeing, is the top seller globally. What do you think was the point of no return for America and Japan for technology development?

These days, everywhere in the world, companies care about the rules, care about what people are thinking, and care about political considerations, so they can no longer challenge. Do you know when the Boeing 737 was first made? It was 65 years ago, and it still has the same design. What’s going on? Before World War Two, we had weak plane designs, but after the war we had companies like Boeing and Cessna. Now, things are still the same and there’s nothing new, so we need to change.

Your company had an IPO in 2025 on the Tokyo Pro market, which is the specialized TSE market for innovative companies. What led to your decision to go public?

We are a small company, but for small airplane aviation, we are starting to take control of the market a little and even the JCAB has started listening to what we have to say. Still, we are a fairly new company for the aviation industry because we have only been around for ten years, and some people don’t trust a company that young. On the other hand, people trust and listen to a publicly listed company, so that’s the reason. I especially want people to listen to us so we can change the aviation situation.

We’ve had the chance to interview many finance companies working with the stock market and institutional funds. Many of these companies are talking about how foreign investments in Japan are increasing. Do you think a foreign investor would be interested in investing in your company, which is unique in this Japanese market?

If somebody offered to invest a lot of money into Japanese aviation, I would advise they don’t do it because things first need to change. The industry here has to change, but nobody knows how to change it, so that’s the problem.

You mentioned how you decided to start this company when you saw that there was no one able to handle things like imports, distribution, and the full services that you offer today. What is your company’s unique competitive advantage in this industry to fend off any potential new competitors?

We started very small, just maintaining one airplane, and then that became two, three, four, five, etc. Then, we changed the rules for Japanese aviation to do things in an easier way because it was too complicated. So, if some competitors appear and do more than us, I’ll be happy, but I don’t see that happening because we keep improving the company. Every day, we are talking to the JCAB and pushing them to do things right away, so if somebody else comes along and helps us with that or does what we are trying to do, I would support them.

Looking at your capabilities, how do you think they compare to similar companies operating in other countries?

These days, mechanics and pilots go to school and they get licenses for bigger airplanes and then they are ready for the airlines or other companies, but they cannot do anything because they don’t have experience. We already have a lot of experience maintaining airplanes, so I don’t think other people can do what we can now. To get more experience than us, it will take maybe five or six years to get the same skills that we have. A license or formal training isn’t the same as real experience and skills, which take time to develop.

Aviation is a broad industry. Are there certain areas where you need to outsource and, if so, do you see a need to develop a network of partners to do that? Alternatively, do you see the need to recruit certain human resources?

Yes, we are looking, especially regarding any situation where we see challenges in the market. For example, the JCAB has very strict regulations about the Gulfstream airplanes, specifically their G200, so those basically cannot be registered under a Japanese tag. Therefore, we import them from the US under an American registration company, but we cannot manage them, so we work with Air 7, based in Singapore, and they are the management company for those airplanes, which are technically Japanese aircraft, even though they are registered under this blanket of being an American aircraft. So, we work with Air 7 consistently for situations and challenges like that, especially with that aircraft.

We are also expanding to Korea right now and I want to expand to China as well, so I am looking for workers, but they need experience and skills, so it takes time. Currently, our mechanics can do everything, from maintaining airplanes to painting them. They also know aerodynamics and engineering, so they are ready for anything, but normal mechanics, anywhere in the world, don’t have this knowledge. They have a license and they specialize in a certain area, and that’s all.

To find these mechanics in China and Korea, are you going to partner with educational institutions or are you going to maybe send some mechanics in Japan to train new people in those countries?

I think I have to bring those people here to work and train for at least two years, and then send them back. That’s how I see us expanding. These days, everybody has a limit on what they can do because the United States aviation industry has created limits. They basically stopped developing new technology and styles. If something new comes along, the US doesn’t allow it, and if they don’t allow it, nobody in the world will do it. Of course, the United States invented the airplane and the aviation field, and they’re a leading country for aviation today. All countries have their own rules and limits, but the US is at the top of the field, so we have to change that. China is doing interesting things, but if we buy Chinese avionics, there’s no way I can install them legally.

Is the quality of those Chinese avionics and parts good?

Yes, you would be surprised at how good their quality is, and if I order something, they ship right away. I actually went to China a couple of weeks ago and I was surprised to see their train quality. People say it’s not that good, but actually it’s very good.

They have their own maglev already.

Yes, it is good and everything is electric and very organized and of very good quality. Many people, including myself, used to talk badly about the things made in China, but everything has changed.

You see it in the automotive industry as well. The cars you can get in China are really good and even the standard cars include options that are extra in a Western brand car.

After World War Two, until maybe the 1980s, Japanese products were terrible. They were cheap and copied everything, but over time they changed and the world came to trust Japanese products and their good quality. Now, I guess China is doing the same thing.

You mentioned the experience and skill of your workers and I was interested to learn that you worked on the YS-11 in the early days of your company. Could you talk a bit about this experience?

We succeeded whereas others couldn’t because, as I said, other guys only have licenses and no deep skills. I had to show the government what can be done because that used to be owned by the government. They said those airplanes were no longer safe or flyable, so they had banned them for ten years.

You leveraged this success to push the government to work on the rules to make it more accessible and to spur more innovation. Are you looking in the future to have new milestone projects like the YS-11 to showcase your capabilities to the global market?

Yes, and I have an employee who used to be a politician and we will leverage his network because that’s the only way in Japan since they never listen. Aviation agencies everywhere in the world don’t really know about aviation and don’t want to listen. That’s why Mitsubishi and ShinMaywa can do what they’re doing, because they have contacts and know the right people.

Your current business model focuses on small jets and helicopters, but the aerospace industry is also becoming commercialized. That’s one area of expansion potentially for a company like yours. Another area could be this idea of sky taxis for urban transport. We met a company called SkyDrive that is working on this. Do you see these as new potential growth opportunities?

No way. There is a zero percent chance for either of those.

Why?

For the sky taxis, because they are not safe. These are basically like big drones, though they have a wing type also, which is more like an airplane. Those can fly maybe 40 minutes, but the helicopter type, they can only fly about eight minutes and where can you go in eight minutes and then have a dead battery? These days, when helicopters run out of fuel, they can still land. Airplanes are the same.

Of course, if the military wants to use those drones, maybe that could be viable, but if you want to use them commercially, you must prove they are completely safe, and then you have to talk about insurance because insurance companies will not accept those things. Also, right now, we don’t have the technology needed. They are trying to go electric using a battery. The best battery is from Panasonic, which is what Tesla is using, but it’s still too heavy.

The infrastructure is also not in place for that. For cars, we have roads to drive on, but if you do this stuff, where can you fly and land?

So, I think it’s not viable, but they do it because the drone guys have good political connections. The government doesn’t know, but the drone guys influence them and that’s something I have learned and need to do better myself.

I understand you are working with Garmin and I am curious to know how this came to be and are you looking to work with other technology providers?

Actually, I’m looking almost every day at new technology. For example, some guy makes aero glasses so if you wear those you don’t need the cockpit because everything gets shown on the glasses, but the FAA hasn’t approved them. If the FAA doesn’t approve them, then nobody can use them because they are the king of aviation, and if the king says no, it’s no.

Why did you decide to work with Garmin?

We used to use an old-school avionics steam gauge and Garmin made a better one that was approved, so that’s why we are working with them. Also, many of our aircraft use them because they are an industry standard, and being an avionics dealer for Garmin means we get discounts which we can then pass on to our customers.

Would you be looking for an exclusive distribution agreement with any international companies to be the sole importer for Asia Pacific or for Japan?

There isn’t a specific company I can think of, but any company would be fine if there are companies that are interested. For example, we work on a lot of Beechcraft and Cessna airplanes, so if we were to become an avionics dealer for Textron, it would be welcome. We have Honda jets too, so if we become a dealer for them, then we would get cheaper parts prices which we could pass on to the consumer. Any business wants to provide high-quality service at the lowest price, so if any of these companies were to offer us dealerships, of course, we would do that because it also makes us look better being a dealer while, at the same time, saving our clients money.

For avionics, we have Honeywell and Bendix King, and then Garmin. They have FAA approval, so that’s all. A lot of these companies, not just for avionics but aircraft also, are oligopolies and monopolies, so there are not really that many choices we can make.

Looking at your plans to expand to Korea and China, are you looking to work with other kinds of products there that you’re not used to working with here since the regulations are maybe different from in Japan?

Korean regulations are similar to Japan, so that won’t be much of a challenge, but China’s regulations are different.

What would be the mode of expansion in those markets? Would you be looking at partnerships, joint ventures, M&A?

A partnership is fine, but since no company can do what we can, we have to create our own operations there.

You are a young company, founded in 2014, so you just celebrated ten years last year. Let’s imagine it’s ten years from now, in 2034, and you are celebrating your 20th anniversary. Where do you see the company then and what would you like to achieve as president?

I would like to expand a little and make better aviation. That’s all I want. Actually, I don’t care about making money because when money is involved, skills go down, so we have to create a real aviation company with real mechanics and real pilots, but it’s probably not going to happen. Of course, I cannot see ten years in the future, but I think war is coming soon, so there is no point in thinking about it. Still, I have to take care of my employees, so I guess that my real goal is to protect them.

For more information, please visit their website at: https://aerolab.jp/company/

To read more about Aero Lab International Inc, check out this article about them.