News
China’s aviation regulator announces policy changes amid onslaught of start-ups
September 30th 2016
The Mainland’s aviation regulator, the Civil Aviation Administration of China (CAAC), is looking to limit market saturation and address growing airport congestion and safety concerns by tightening the rules for setting up new airlines. Read More »
"The CAAC will severely restrict airline establishment," the regulator declared, dissatisfied with the industry's increasing fragmentation. It stated it wants to "avoid a situation in which airlines are numerous, small, scattered and weak." Twenty new carriers were approved in the last five years, said the CAAC, with provincial and city governments' eagerness to have their own carriers a key driver of the proliferation.
The CAAC said a maximum of three airlines may be “home-based” at an airport that handles 10–30 million passengers annually, four at airports with annual traffic of 30–50 million and five at airports where volumes exceed 50 million.
China’s airports continue to be hopelessly overcrowded, severely impacting airlines’ on-time performance.
International Air Transport Association (IATA) vice president Asia-Pacific, Conrad Clifford, this week repeated that aviation infrastructure capacity across the region was at “dire” levels and required urgent attention.
Speaking at the IATA World Financial Symposium in Singapore, Clifford said Asia-Pacific carriers have enough aircraft on order to sustain growth, but bottlenecks created by inadequate runways and terminals as well as airspace capacity have become “dire”.
“Governments have to do something about this. They’ve been caught out by the growth and the explosion of LCC [low-cost carrier] activity in the last five years. That’s caught everybody by surprise,” he added. Beijing, Shanghai, Hong Kong, Jakarta, Manila, Incheon and Bangkok are operating beyond their design capacity.
