China’s carriers accelerate international operation expansion
Chinese carriers have intensified their expansion of international operations recently, with all major carriers launching a more international services this year.
Chinese carriers have intensified their expansion of international operations recently, with Air China, China Eastern Airlines, China Southern Airlines and Hainan Airlines launching a number of international services this year.
Air China plans to launch a record number of new international air routes this year, and has recently announced the launch of a new Beijing-Minsk-Budapest service and will increase services on its Beijing-Los Angeles route to three flights daily this summer.
China Southern’s marketing network deputy manager Xuze Wang said the carrier has been accelerating development of international air routes since 2014 and about half of its top ten most profitable air routes are international routes.
For example, China Southern had flown more than 66,000 flights during the Spring Festival peak period, carrying some 10 million passengers, a y-o-y increase of 9%. The number of passengers on international or regional services was up 21% y-o-y, far above domestic service growth.
China Eastern Airlines’ passenger transportation volume grew 6.3% in 2014 and is continuing to grow in 2015 under the airline’s Pacific Plan and Europe Profit Plan globalization strategies, according to the carrier’s internal report. The work report also said that the best resources should be allocated to the carrier’s international operations.
Hainan Airlines is also sparing no efforts in promoting its international air routes and has already opened three China-US services from Beijing to Seattle, Boston and Chicago. It will also open three more additional services from Beijing to San Jose and from Shanghai to Boston and Seattle in June.
The scramble for new international services among Chinese carriers has a couple of specific characteristics: the popularity of US-China services has soared in peak seasons and on a monthly basis and the number of Chinese carrier’s US-bound flights exceeds the number of US carrier’s China bound flights; and more and more Chinese carriers are choosing to depart from second-tier cities like Chengdu, Wuhan and Hangzhou.
Hainan Airlines said the popularity of US-China services was stimulated by the increase in demand following the easing of US visa policy and the massive scale of Chinese studying abroad. Compared to the Europe-Chinese operations that have Middle East and Turkish competitors, US-China operations are also more stable and present Chinese carriers with a golden age for growth.
China recorded 117 million outbound trips in 2014, overtaking the USA for the first time to become the largest outbound tourism market in the world. Outbound travel from China is expected to maintain 17% growth in 2015, according to recent data by the China Tourism Academy.
As the industry enters a cycle of growth, it remains to be seen if Chinese carriers can leverage overseas expansion opportunities and elevate their competitiveness internationally.(Translation by David)