Airline competition intensifies as inland cities draw more international routes

By Tu Lei Source:Global Times Published: 2016-5-12 20:43:01

Stores in Chongqing Jiangbei International Airport in Southwest China's Chongqing Municipality File photo: CFP

In one week, two foreign airlines have each opened a new international route from a city in Western China, illustrating the growing demand in this once sleepy part of the world's second largest aviation market.

On Tuesday, United Airlines launched a thrice weekly route from Xi'an, capital of Northwest China's Shaanxi Province, to San Francisco. It is the first trans-Pacific route to Xi'an.

A week earlier on May 3, Emirates opened a new route from Dubai to Yinchuan, Ningxia Hui Autonomous Region in Northwest China, and Zhengzhou, Central China's Henan Province - two growing cities in inland China. The airline now offers five destinations on the Chinese mainland. The route runs four times a week.

As the commercial flight markets in China's first-tier cities get saturated and airport slots grow scare, foreign airlines have been pushing the battlefield inland to the country's second and third-tier cities, especially in Western China.

Expanding routes

For Emirates, which has been operating in China for 14 years, the new route aims to provide residents in and around Yinchuan and Zhengzhou with convenient and fast connections via Dubai to destinations in the Middle East, Africa and Europe, according to a statement from the airline's chairman and chief executive, Sheikh Ahmed bin Saeed al Maktoum.

By flying through Yinchuan, airlines can save 20 percent on transport costs when flying to the Middle East and Europe, China Business News reported, quoting He Zhengrong, head of Ningxia's department of commerce.

Yinchuan is the latest city in Western China seeking to attract additional international routes. Other examples include Chongqing and Chengdu, Southwest China's Sichuan Province.Many foreign carriers have also added Xi'an to their networks.

In June 2013, Finnair launched a direct route from Xi'an to Finland's capital of Helsinki.

There are now 28 international routes from Xi'an to 12 countries and regions, including Rome, Tokyo and Kuala Lumpur. Prague and New Delhi are also in the pipeline.

Airlines have also been increasing flights from the airport to some overseas destinations. For example, KLM Royal Dutch Airlines will increase the frequency of flights on its route from Chengdu to Amsterdam from three times to four times per week from July. United Airlines also increased the frequencies from Chengdu to San Francisco from thrice a week to daily in the summer peak season last year.

Air New Zealand has said it expects to open a direct route from Auckland to Chengdu at the end of this year.

In addition, local airports are also in a frenzy to expand to meet future demand. Last year, Xi'an airport handled 32.97 million passengers, ranking eight across the nation. The airport plans to have eight to 10 international routes this year.

In April, the Sichuan Development and Reform Commission said regulators had approved a plan to build a second airport in Chengdu.

The project will cost an estimated 71.86 billion yuan ($11.04 billion) and will be the largest civilian airport built during the period of the 13th Five-Year Plan (2016-20).

The airport, to be completed in 2020, could receive 90 million travelers per year in a long term. It will focus on international routes, especially to Europe and the Middle East.

Currently, Chongqing is building T3A terminal and the third runway for the Chongqing Jiangbei International Airport. The terminal is expected to open in the first half of 2017, making the airport the largest in Western China.

Domestic forces

Western China has not only drawn flocks of foreign airlines, but domestic ones as well.

Since last year, carriers such as Hainan Airlines and Xiamen Airlines began their march to international cities, with cities such as Xi'an and Chengdu as their points of departure. In April, Air China conducted the maiden flight on its route from Chongqing to Dubai, the first flight to the Middle East from the city.

China Southern said it will increase the frequencies to four times per week from Lanzhou in Northwest China's Gansu Province to St Petersburg via Uyghur from June 20.

More cities in Western China, including Chengdu and Chongqing, have showed interest in working with Emirates on a route to Dubai, but much still depends on negotiations in June with Chinese regulators on traffic rights, because the Chinese side has not used up its quota of 56 flights a week, the 21st Century Business Herald reported on Wednesday.

However, there is a big gap between the capabilities of Chinese and overseas carriers to explore domestic routes. In many cases, a domestic carrier will open a route only after overseas carriers have been flying it for a while, said an industry insider who asked to remain anonymous.

US carriers have dominated the bilateral market for a while, but domestic airlines have recently started to grab more territory as awareness about them has grown, the insider told the Global Times on Wednesday. "The Chinese carriers are waking up and on the way to catch up."


Newspaper headline: The battle for West China’s skies


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