Home' Asian Aviation : AAV May 2017 Contents REGIONAL AVIATION
AsianAviation | May 2017 29
MAINSTREAM TAIWANESE AIRLINES that fly to China following
landmark deals between governments over the past decade are
adding to a few profitable routes rather than opening flights to new
cities, while focusing more on other parts of Asia in view of a chill
in political relations.
China Airlines and EVA Airways, both based in Taiwan, as well
as their subsidiaries, are expected to sustain flights or add them
at mainland Chinese commercial hubs such as Guangzhou and
Shanghai, but shun flights to smaller cities in China.
Those moves reflect continued support from Taiwanese business
people with China investments, but a drop in tourism to Taiwan and
a broader freeze in political ties.
As of March, a total of 11 airlines from Taiwan and China had taken
855 of the 890 weekly routes arranged between the two govern-
ments as of 2015. The figure covering 57 air-
ports on both sides has barely changed from
a year ago. After Taipei-based TransAsia
Airways shut down in November, the major
carriers and subsidiaries grabbed only its
former 13 Shanghai routes, according to Tai-
wan Civil Aeronautics Administration figures.
Far Eastern Air Transport, a Taiwan airline
specialising in minor destinations, picked
up nine old TransAsia routes to Fuzhou
and a budget carrier got two Wuxi routes.
Fuzhou and Wuxi are secondary cities in
terms of economic significance compared
TransAsia folded after two fatal crashes
on domestic routes. Other airlines have not
applied to fill its remaining four China routes.
“ Taipei-Shanghai remains on top of the list,” said Daniel Peng,
spokesperson for China Airlines. “ With some of TransAsia’s traffic
rights reallocated to China Airlines Group, we have been processing
applications to the authorities concerned on both sides so as to
improve the profitability by increasing flight frequency or capacity.”
China Airlines runs 121 flights to China per week now, down from
140 in mid-2016.
Taiwanese investors have had a reason to travel to cities such as
Shanghai and Guangzhou since the 1980s, sustaining air traffic. They
normally use two airports serving the capital Taipei, slowly sidelining
other parts of Taiwan.
Group tourism from China fell about 30 percent last year after a re-
cord 3.4 million trips in 2015 because Beijing is showing displeasure
with Taiwan’s president of the past year, political scientists in Taiwan
say. President Tsai Ing-wen’s party advocates more autonomy for
Taiwan rather than Beijing’s goal of unification with China.
“ There’s just so little demand for these places due to cross-Strait
tension and lack of tourists to Taiwan,” said Eric Lin, aviation sector
analyst with UBS in Hong Kong. “Even before that, these routes were
marginally profitable for the Taiwanese airlines.”
Regular direct flights between Taiwan and mainland China began
in 2008. Travellers once had to transfer in places such as Hong
Kong and Macau for trips of at least five hours compared to less
than two today.
That year the two sides also agreed to let Chinese tourists visit
Taiwan, which had been off limits for security reasons.
Flights between Taiwan and other parts of Asia are now picking up
for Taiwanese airlines, said Shukor Yusof, founder of Malaysia-based
aviation consultancy Endau Analytics. Expect growth in Taipei-Bang-
kok, Taipei-Hong Kong and Taipei-Manila flights, he said.
Taiwan has since August relaxed visa rules for citizens of Thailand
and Brunei, for example, as part of a year-old policy to build stronger
economic links with Southeast Asia. Taiwan will try exempting visas
for Filipinos for a year starting in June.
“ The visa-free policy to Southeast Asian
visitors has helped,” Yusof said. “ Tai-
wan-mainland China relations are under
stress due to the new president and if this
continues, of course Taiwan will see less
As Taiwan has also grown popular with
tourists from Japan and South Korea, China
Airlines said in February it was profiting from
its routes to 15 airports in Japan and three
in South Korea.
Far Eastern Air Transport also expects
growth in routes around Asia outside China,
said company spokesman Huang Yu-chi.
While the Fuzhou routes are “profitable”
because the mainland Chinese wives of
Taiwanese men often use the city to reach
Taiwan, the spokesman said, “we have for sure been affected by
the cross-Strait situation, especially the cooling of tourism from
Taiwanese airlines also want China to let its citizens transit in
Taiwan en route to other countries, such as Canada and the United
States. Mainland Chinese passengers offer steady revenue in every
season because of their population size and demand for overseas
travel, Lin said.
Last year the number of outbound travellers from China reached
122 million, up 4.3 percent over 2015 as incomes grew, according to
the China Tourism Academy.
Beijing signalled in 2014 it was ready to begin talks on letting its
citizens transit in Taiwan. Taiwanese passengers can already transit
in China. But China cut off all dialogue last year over political dif-
ferences, meaning no talks on civil aviation until the two sides find
their way back to the bargaining table.
“If both Beijing and Taipei wait, and do nothing, that approach will
lead to a kind of awkward position or situation for both sides,” said
Alexander Huang, strategic studies professor at Tamkang University
There’s just so little
demand for these places
due to cross-Strait tension
and lack of tourists to
Taiwan. Even before
that, these routes were
marginally profitable for
the Taiwanese airlines.
ERIC LIN, UBS
new routes as
AAV_May 2017.indd 29
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