News
China’s undiminished appetite for aircraft and routes despite slowing economy
February 26th 2016
Shanghai-headquartered Spring Airlines has a message for Airbus: produce more planes because China needs them, Bloomberg reports. Read More »
"Airbus isn't producing fast enough," Stephen Wang Zhenghua, vice-president of the Mainland’s first, and largest LCC, said in an interview in Singapore last week. "There isn't overcapacity in China. For the Chinese aviation industry, there's still at least ten golden years. That is ten years of big growth," he said.
Spring Airlines ordered 60 A320neos in December, but said it would like more jets because of rising demand in a nation projected to become the world's biggest air travel and aerospace market in two decades. To meet that demand, Airbus has an A320 final assembly line in Tianjin and it will add an A330 completion and delivery centre scheduled to be operational in 2017. Competitor Boeing said last year it would to set up a finishing shop on the Mainland, but has yet to confirm the location.
Spring has not placed additional orders for aircraft because it is concerned about long delivery backlogs, but said it would take early slots that might become available if carriers defer or cancel orders, Wang said.
In January, Air China grew its ASKs by 14% year-on-year; comprising 35.5% international growth, 6.9% regional growth to Hong Kong, Macau and Taiwan and a 4% domestic improvement. Air China’s RPKs rose 18.6% year-on-year at 43.7% international, 21.9% regional and 6.8% domestic. In January, the Star Alliance carrier and its subsidiaries took delivery of five new aircraft; two B737-800s, two A320s and a business jet. The new aircraft took the flag carrier’s fleet to 594 aircraft.
At Guangzhou’s China Southern Airlines ASKs in January improved 10.7% year-on-year at 20.2% international and 4.6% domestic with regional growth flat at .05%. RPKs rose 10.5%, made up of 32.2% international and 3.6% domestic. Regional RPKs dropped 1.1%. The Skyteam carrier took delivery of three new B737-800s in January for a total of 668 aircraft.
Civil Aviation Administration of China (CAAC) data reported Mainland carriers produced a consolidated net profit of 1.5 billion yuan ($230 million) in January, more than three times their earnings of the corresponding year-ago period.
New routes from the carriers include Air China’s thrice-weekly Chongqing-Dubai A330-200 service from April 2, followed by a daily Shenzhen-Melbourne A330-200 rotation from October. It launched its first long-haul service from Shenzhen on February 1 with a daily Los Angeles route via Beijing.
Sichuan Airlines this week applied for thrice-weekly Chengdu-Hangzhou-Los Angeles A330 traffic rights from June. Earlier this month, it applied for rights between Chengdu, Jinan and Los Angeles, also from June.
In other Mainland news, Bohai Leasing Co., Ltd., the newly-acquired leasing arm of HNA Group, announced its name is changed to Bohai Financial Investment Holding Co., Ltd., effective from February 23. The HNA Group last week signed an agreement to take over California-headquartered electronics distributor, Ingram Micro Inc., for $6 billion.
