30 WAYS TO SURVIVE LONG-HAUL ECONOMY
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68 international destinations, it became the first Chinese airline to fly to six continents with the launch of Johannesburg services in 2015.
The carrier has also been making rapid upgrades to its fleet – last year, it welcomed its first B787-9 Dreamliner. Wang Yingnian, chief pilot of Air China, says: “We believe the B787-9 will become the backbone of Air China’s international long-haul routes, and will play an important role in supporting Air China’s international development strategy.” It has a total of 15 Dreamliners on order.
Meanwhile, China Eastern’s annual income looks enviably healthy, increasing from RMB40 billion (£5 billion) in 2008 to RMB100 billion (£12 billion) in 2016, with passenger traffic jumping from 12.8 million in 2014 to 15.3 million in 2015. It has launched 21 new international routes since 2013, including destinations as geographically diverse as Chicago, Amsterdam and Brisbane.
Fleet upgrades include the retrofitting of its B777-300ER with new first class, business and economy seats. The airline has placed an order for 20 A350s and 15 B787s, the latter of which it plans to operate on North American routes. Liu Shaoyong, the carrier’s chairman, says: “The introduction of the A350 XWB will play an important role in promoting our operational capability, profitability and service brand on international long-haul routes, and opening a new chapter in the international development of China Eastern Airlines.”
China Southern lays claim to being the first airline in the world to operate both the A380 and B787 at the same time. It has the largest fleet in Asia and, over the coming five years, will continue to strengthen it by purchasing new aircraft types such as the B787-9 and B737 MAX. By 2020, its fleet size is projected to increase to 1,000 aircraft, and it expects to carry 168 million passengers annually.
The airline now flies to 49 international cities after launching routes to Toronto and Adelaide last year. It has plans to begin a South American service, flying to Mexico City via Vancouver, while direct flights to Frankfurt and Cairns are also on the cards.
Headquartered in Guangzhou, China Southern is also expecting to benefit from recent developments at Guangzhou Baiyun International airport, which opened a third runway in 2015 and has a second terminal due to open in February next year. This expansion, combined with the 72-hour visa-free option implemented to entice transit passengers, should encourage international travellers to use Guangzhou as a transfer hub.
FAST MOVERS
While the “big three” have dominated thus far, a handful of airlines are expanding so aggressively that they may well challenge the status quo. Hainan Airlines and Xiamen Air, in particular, have grown quickly in terms of fleet size and expanded their route networks to the US and Europe.
Owned by conglomerate HNA Group (which has a stake in some other airlines, including Virgin Australia), Hainan Airlines has seen major investment and rapid growth. The jewel of the fleet was introduced in June last year – a B787-9 with 30 “Super Diamond” business seats and 259 economy seats. The aircraft features free wifi and Panasonic’s eX3 in-flight entertainment system. Business class passengers can look forward to Bulgari amenity kits and Bose noise-cancelling headsets.
The latest Dreamliner will be deployed on US routes such as
Las Vegas after familiarisation is completed, as well as on the carrier’s newest services to cities such as Manchester, which began in June 2016, and Tel Aviv. With expansion plans targeting Europe and the US, the airline is applying to fly to London, New York and Los Angeles.
Until recently, Xiamen Air’s business model focused solely on regional and domestic markets, but it took an important step in 2015 with the delivery of its first B787-8, which it deployed on its inaugural European route to Amsterdam. The carrier launched a Sydney service in the same year, followed by Melbourne, Vancouver and Seattle in 2016. It now has six threeclass B787-8s offering first class, business and economy seating, along with the newer B787-9.
Che Shanglun, the airline’s president, says:“By 2020, we expect to expand our fleet to 268 aircraft, with an annual passenger capacity of 50 million, and profits exceeding RMB50 billion [£6 billion]. We aim to become a top Asia-Pacific airline, and break through into the top 20 of the aviation market.”
Sichuan Airlines, too, is eyeing a share of the global market, and now flies to cities such as Sydney, Vancouver and Los Angeles. Tianjin Airlines launched services to London Gatwick and Auckland last year, and is planning to link Tianjin up with Melbourne later this year. Shenzhen-based Donghai Airlines finalised an order for 25 B737 MAXs and five B787-9s last July.
BUDGET BOOM
The low-cost carrier (LCC) market is also poised for a meteoric rise in mainland China. Spring Airlines – China’s first LCC – took off in 2005 and now offers international services to Asian cities such as Tokyo, Bangkok, Singapore and Seoul.
In 2013, recognising the success of the budget market globally, the CAAC began to encourage this strategy. The result was a flurry of new arrivals, bringing the current total to seven carriers. These include the establishment in 2013 of Ruili Airlines and, in 2014, of 9 Air, the Guangzhoubased subsidiary of Juneyao Airlines, as well as the conversion of China United Airlines into a low-cost carrier.
The growing importance of Chinese LCCs was underlined in
January 2016 with the creation of U-Fly Alliance – the world’s first LCC coalition. Three of the four founding members are based in mainland China (Lucky Air, Urumqi Air and West Air), with Hong Kong’s HK Express also part of the network.
Still, there is plenty of room for growth. According to air travel information company OAG, the low-cost sector accounted for only 7 per cent of China’s domestic air market in 2015 (compared with 40 per cent of Europe’s, 56 per cent of South East Asia’s and 32 per cent in the US), and this is expected to double by 2020.
MADE IN CHINA
A major watershed moment in China’s aviation history came last year, when the first ever Chinesemade commercial passenger jet began to operate flights. The state-owned Commercial Aircraft Corporation of China (COMAC) was founded in 2008 to develop a regional jet programme, with serious intentions to rival Airbus and Boeing.
In June last year, Chengdu Airlines received the first ARJ21 – a short- to medium-haul aircraft with 78 seats in two classes. Its maiden flight from Chengdu to Shanghai took place later that month; the airline has 30 ARJ21s on order.
COMAC’s latest model is the C919, a narrow-body aircraft with up to 168 seats, which entered the flight test stage in February. So far, the manufacturer has received 570 orders, with China Eastern set to become the first airline to operate the model once it is ready.
Given the appetite of China’s aviation industry players, it’s a safe bet that more aircraft models will follow, probably designed to be bigger and with a greater range. China is looking out across the world – and its gaze is far-reaching.