Home' Asian Aviation : AAV March 2017 Contents 30 AsianAviation | March 2017
Chinese like nearby parts of Asia because travel is inexpensive,
accessible for short holidays and free from terrorism compared to
Europe, ChinaTravelGuide.com says.
New routes have emerged as supply catches up to demand. The
number of airline seats for China-Japan and China-South Korea
routes is now increasing 20 percent per year, Lin said.
“Growth in capacity is placing pressure on airline yields, which is
good for the traveller with cheaper fares being offered, but equally
making the operating environment for airlines harder, which in
part explains why you do see such a degree of destination churn
amongst the airlines as they start new services and drop others that
for whatever reason are not working,” Grant said.
Shanghai-based China Eastern Airlines is the major carrier ben-
efiting from those routes and China’s Spring Airlines is the chief
budget airline, Lin said. Korean budget airlines operate the same
routes, he said, but their market is fragmented compared to China’s.
A round-trip Shanghai-Tokyo ticket was selling for US$224 on
Spring Airlines in the week of 13 February. Flights between Seoul
and Dalian in northeastern China just 90 minutes away were priced
at US$157 on China Southern Airlines.
Tokyo-based flagship carrier Japan Air-
lines said on its web site that in December
China routes generated the top source of
passengers for a single country, totalling
109,000 of the 668,000 who took internation-
al flights that month.
Hong Kong International Airport, a hub
for greater China and a flight gateway to
other parts of the world, last year added
three Japanese destinations — Ishigaki,
Takamatsu and Yonago — its only new ones
in Northeast Asia and among eight added
overall in 2016. The airport handled a daily
record of 1,270 flight movements over the year, the airport said in
a statement in January.
Taiwanese are also partial to Japan. Despite colonising Taiwan for
50 years through to the end of World War II, Japan draws Taiwanese
travellers who are curious about its winter snow, Tokyo Disney-
land and cultural similarities between the two places. Some travel
between the central Taipei Songshan Airport and Tokyo’s in-town
Haneda Airport, bypassing long trips at either end to international
terminals in satellite cities.
China Airlines, a flagship carrier in Taiwan, runs flights to 15 cities
in Japan and three in Korea — Busan and the two major Seoul air-
ports. It would not specify which were added last year.
“Due to the distance and travellers’ preference, China Airlines
has been obtaining steady profits from the Northeast Asia market,”
company public relations vice president Daniel Peng said. “China
Airlines keeps assessing (Northeast Asia) with market demands.
Any further progress will be announced in due course.”
China Airlines has also talked to Japan Airlines and Korean Air,
among others outside Northeast Asia, about code sharing, Taiwan’s
Central News Agency quoted company chairman Ho Nuan-hsuan
as saying in mid-February.
In January, the Taiwanese carrier and Japan Airlines signed a
memorandum of understanding to expand code-share flights be-
tween the in-town airports from 28 to as many as 240 per week, the
Japanese side said in a statement.
For Taiwanese rival carrier EVA Airways, Japan and Korea flights
“outperformed” other routes in Northeast Asia with average pas-
senger load factors of about 85 percent and 90 percent during high
seasons, the airline told Asian Aviation in a statement.
Taking advantage of Japan’s open skies policy, EVA operates 121
flights to nine destinations in Japan every week. South Korea, how-
ever, restricts flights by foreign airlines, leaving EVA and its affiliate
UNI Air with 34 weekly flights to Seoul.
Japan derives about US$83 billion in GDP from civil aviation. It
looks now to international travel for economic stimulus, according to
a paper by Routes, part of the aviation consultancy ASM Ltd. About
5.5 million flights departed from Japan last year, with a 10.3 percent
pickup in international capacity, Routes says.
It says the fastest growing Japanese airlines
are Solaseed, Spring Airlines Japan and Fuji
Restrictions in South Korea on foreign
airlines along with Chinese tourist dissat-
isfaction with required shopping could limit
growth of new air routes between the coun-
tries, Lin with UBS said.
South Korean officials last year revoked
the licenses of 68 travel agents that served
Chinese tourists. Chinese travellers also can-
celled trips to South Korea last year over
Seoul’s decision to deploy a missile defence
system that China opposes, according to Beijing’s state-controlled
Global Times newspaper online.
But Chinese outbound tourism will keep growing along with
boosts in income, availability of cheaper flights and more new
routes, Shukor forecast.
Expect growth in “city pairs” rather than “hub-to-hub” travel, a
trend that could take traffic away from major regional airports such
as Hong Kong, he said.
China will drive formation of international city pairings, many of
which start at “low frequency ” for a few years to await improving
demand or increases in local subsidies, said Will Horton, senior ana-
lyst with the CAPA Centre for Aviation market research organisation
in Hong Kong. Low-cost carriers (LCCs) such as Air Seoul, which
is owned by the larger Korean-based Asiana Airlines, tend to lead
the trend, he added.
“Maybe one of the less appreciated dynamics is the rapid growth
of LCCs in the Japan-Korea market, and that is forcing full-service
airlines to think about new strategies,” Horton said.
Due to the distance
and travellers’ preference,
China Airlines has been
obtaining steady profits
from the Northeast
DANIEL PENG, CHINA AIRLINES
23/02/2017 5:18:59 PM
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