China’s new rich set to drive inland expansion of overseas flights

Many of China’s airline hubs are on the coast, yet it is the newly wealthy living inland who China are looking at to drive the next period of expansion with Chinese airlines. It is known that Air China, China Eastern Airlines and China Southern Airlines are all adding flights to New York, Paris and Sydney from burgeoning inland cities such as Wuhan and Chengdu, while for the first quarter of the year all three saw RPKs (revenue per passenger kilometres) climb to near record highs. Andrew Herdman, director general of the Association of Asia Pacific Airlines said that, “Historically what happened is strong hub-to-hub, but when the market grows, it makes sense to come up with direct service to non-hub cities.” The increasing appetite for travel of the Chinese is also seeing flights established to secondary cities in Australia, North America and Europe. This expansion fits in with the announcement back in July 2014 that China planned to build an additional 100 airports in the country over the following ten years.

Last year China’s outbound leisure travel numbers surpassed 100 million, which set a new record. What’s more is that this number is expected to increase 10 percent this year as a number of countries, including the United States, France and Australia, relax their visa policies. According to Mark Clarkson, business development director for Asia Pacific at OAG, 2015 will also see China offer more seats to major US cities than US airlines for the first time. Additionally, Air China intends to resume services to Africa and the flag carrier will be flying to Johannesburg and Addis Ababa later in the year as well. Rival airline China Southern will commence flights to Nairobi from Guangzhou in August, while even the smaller carriers who have, up until now, been wholly focussed on the internal domestic market are going international as well. For example Xiamen Airlines will be flying to Amsterdam from July and hopefully North America later in the year, while Sichuan Airlines is already flying to Melbourne and Vancouver.