Airline News
Mainland Digest: Spring and Ruili expand and Pudong Shanghai airport posts record profits
September 7th 2015
The Mainland’s first private low-cost carrier, Shanghai Hongqiao-based Spring Airlines, is looking overseas for growth. Read More » It serves 30 destinations, approximately half of which are in the Mainland, but said increasing bottlenecks and delays at major Chinese airports like Shanghai and Guangzhou have been crippling its operations so it plans to add more overseas routes, Wang Yu, the airline's vice president, told the South China Morning Post last week. "Recently, [demand for] our regional flights to Japan, South Korea and Southeast Asia has increased dramatically," Wang said. China recorded 114 million outbound travellers last year, or less than 10% of its 1.4 billion population, according to figures supplied by Spring. "We will have a golden era in the next few years," Wang predicted and added that as a next step, Spring would increase its aircraft base at Shenzhen from six to 30 A320s by 2020.
Spring Airlines listed on the Shanghai Stock Exchange in January. Since then its stock price has almost quadrupled from 26 yuan to 101 yuan. The budget carrier is worth 40.3 billion yuan ($6.3 billion), making it the most valuable low-cost airline in Asia.
At start-up Ruili Airlines in Kunming, Ma Zhanwei, the carrier’s president, last week said Ruili would increase its fleet from six to 56 B737s by the end of 2025. At press time, Ruili operated 34 daily flights to 17 domestic destinations. Since its maiden flight in May 2014, Ruili has carried more than 12.5 million passengers and produced more than 900 million yuan in revenue, accounting for an approximately 3.4% market share in China’s Yunnan province. It said its load factor since inception averaged 88.3%.
In Shanghai, Pudong International Airport last week reported a net profit of 1.29 billion yuan for the six months ended June 30, surging 25.61% year-on-year, on the back of strong travel demand, lower fuel prices and higher airport capacity. During the first half, Pudong handled 217,000 aircraft movements, 28.99 million passengers and 1,574,300 tons of cargo, up 14.1%, 18.3% and 5.5%, respectively.
In other Mainland airport news, the Agricultural Bank of China last week agreed to provide loan facilities of 12 billion yuan to fund the development of Chengdu’s second airport, set to be built 52kms outside the city centre to alleviate capacity-constrained Shuangliu International Airport. With a total investment of 69.26 billion yuan, the new three-runway airport is designed to handle annual passenger volume of 40 million on completion in 2025.
