NETHERLANDS: China Airlines Support KLM

KLM works with three Chinese airline partners: China Eastern Airlines, China Southern Airlines and Xiamen Airlines. These partners have now stepped in to generously support KLM and the Netherlands by donating many tens of thousands of face masks and gloves to KLM in our struggle against the coronavirus outbreak.

In light of scarce resources at Dutch hospitals, KLM will in turn be helping the Erasmus MC in Rotterdam and other Dutch healthcare institutes.

Today, in the early hours of the morning, the first shipment arrived at Schiphol carried by one of Xiamen Airlines' aircraft.

On behalf of the employees of the three Chinese airlines, KLM President & CEO Pieter Elbers accepted this first shipment of in total around 90,000 face masks and 50,000 pairs of gloves.

KLM's CEO was accompanied by Ernst Kuipers, Chairman of the Boards of Erasmus MC and the Dutch Network for Acute Medical Care (Landelijk Netwerk Acute Zorg -- LNAZ), and Brinio Veldhuijzen van Zanten of KLM Health Services.

Over the past 20 years, KLM has established a broad-based route network, coupled with especially close relations in China.

Before the outbreak of the corona crisis, KLM and its partners operated 59 flights a week from Schiphol to mainland China. Shipments of this nature serve to underscore the enormous significance of connections by air in general, and those with China in particular.

Medical supplies like this can only be transported swiftly and efficiently to the other side of the world by aircraft. This is especially important in times of scarcity and interdependence.

KLM President & CEO Pieter Elbers highlighted that: "Help of this nature from our Chinese partners China Eastern Airlines, China Southern Airlines and Xiamen Airlines is both incredibly generous and much appreciated.

Help like this from our Chinese friends serves to highlight just how close the ties are between China, the Netherlands and KLM. These are incredibly difficult times for our country and our company, so we are very pleased with this support for KLM and for the Netherlands.

Less than two months ago, we at KLM made a donation to China and now we have received fantastic and generous help ourselves. This certainly feels good."

On behalf of all Dutch healthcare institutes, LNAZ is coordinating the stocks of personal protective gear for healthcare workers during the coronavirus pandemic.

Ernst Kuipers, CEO Erasmus MC thanked KLM and said, "This donation will help all Dutch healthcare institutes at a critical phase of caring for patients across the Netherlands. We are also incredibly grateful to KLM's Chinese partners for this."

KLM will be flying from Hong Kong to Amsterdam at 1:35 p.m. on Tuesday, local time. The airline has been granted an exemption from the Dutch aviation authorities for the landing ban that applies to flights from the Chinese city, the Consulate General in Hong Kong announced.

Dutch and residents of other EU or Schengen countries stuck in Hong Kong are advised to contact the Dutch airline.

KLM is flying two final flights from Seoul, South Korea this week. The first will be on Tuesday, the second on Thursday, and both flights may be booked on KLM's website.

Cabin crew members of various airlines are deeply concerned about the risks of flying, especially on repatriating flights filled with passengers. "People are afraid," Chris van Elswijk of the Dutch Cabin Crew Association said to Hart van Nederland. "People are concerned about the distance and contact moments with passengers."

According to Van Elswijk, who is a purser for KLM, cabin crew members are trying to stick to the government guidelines of staying 1.5 meters from others, but that is not always possible. "If you work in a full aircraft with 300 passengers, you cannot meet the guidelines that are set," he said.

Airlines are working on measures to increase the safety of passengers and crew, he said. KLM, for example, adjusted the onboard service schedule so that there is less physical- or close range contact between passengers and crew.

And if crew members do not want to fly on a certain flight, their employers are open to discuss their concerns and alternatives, he said.

Because halting all air traffic is not yet an option, Van Elswijk said to Hart van Nederland. There are still many Dutch people abroad. They still have to be picked up.

Meanwhile, the first batch of Rwandans who were stranded abroad amid the novel coronavirus outbreak arrived in Rwanda Sunday, thanks to the Government’s partnership with Dutch airline KLM.

Most governments placed their countries into lockdown with no flights allowed to fly in as a measure to contain Covid-19, which left many people stranded in other countries, including Rwandans.

Rwanda itself put a stop to passenger planes and only emergence landings and cargo transporters are allowed into the country.

Rwandan nationals especially students who study abroad and other diaspora communities had expressed concern recently after failing to find a way to come back home.

The Government had promised that it was working out an alternative to rescue nationals and legal residents who were facing travel difficulties as a result of restrictions imposed by different countries.

“It’s true there is an arrangement between the Government of Rwanda and KLM! The 1st flight was yesterday, another departed today!” Jean Pierre Karabaranga, Rwanda’s Ambassador to The Hague said.

Karabaranga added that the last flight is expected Wednesday 25.

The Ambassador indicated that they have been spreading information regarding the arrangement by informing the diaspora members.

The Minister in charge of East African Community at the Foreign Affairs Ministry, Olivier Nduhungirehe, said this follows a conversation with ambassadors to facilitate all Rwandans abroad.

We had a video call with all ambassadors on Friday and they are facilitating everyone who wants to come back to Rwanda to be able to get here, he noted.

Rwanda has so far registered 19 Covid-19 cases as of Sunday, according to the Ministry of Health.

CHINA: Spring Airlines Buys US$122M Into China Southern Airlines

Spring Airlines, a low-cost carrier, has subscribed to China Southern Airline’s A-share non-public offering in a deal worth 846 million yuan (US$122.78 million), becoming the fifth largest shareholder of the company.

Spring Airlines has subscribed for a total 140.53 million A shares in China Southern Airlines, at a price of 6.02 yuan per share.

It accounts for 1.63% of the share capital after the completion of the issuance.

It is the second time that domestic private airlines have invested in one of the three major state-owned aviation enterprises after the Juneyao Group and its private airline Jixiang Airlines bought into China Eastern Airlines in July.

Spring Airlines said it is actively responding to the call of the state to deepen the reform of state-owned enterprises’ mixed ownership, strengthening strategic cooperation between state-owned capital and private capital, and further stimulating capital vitality.

Spring Airlines Co., Ltd. is a low-cost carrier with its headquarters in the Homeyo Hotel in Changning District, Shanghai, China. While the company adopted the English name Spring Airlines, the Chinese name literally means Spring Autumn Airlines.

Spring Airlines is the aviation subsidiary of Shanghai Spring International Travel Service. It reported a net profit of 950 million yuan or $143 million in 2016

The airline was given approval to be established on 26 May 2004. Its first aircraft, an Airbus A320 formerly of Lotus Air, was delivered on 12 July 2005, at Shanghai Hongqiao International Airport.

Spring Airlines started operations on 18 July 2005 and the first flight on that day was between Shanghai and Yantai. Daily flights to Guilin were also initiated.

To keep operating costs low, Spring sells tickets exclusively from its ch.com website and some designated ticket offices, bypassing travel agents.

Spring no longer offers complimentary on-board meals nor complimentary water; however passengers are able to purchase meals and beverages on board. In December 2006, the airline offered a 1-yuan promotional price which caused trouble with government officials.

In late July 2009, Spring's plan to establish overseas routes was granted by the General Administration of Civil Aviation of the People's Republic of China, making it the first budget airline in China to explore the international market.

The airline plans to operate short-distance routes linking mainland Chinese cities to Hong Kong and Macau, as well as neighboring countries such as Japan, South Korea, Cambodia, Singapore, Vietnam and Thailand.

On July 29, 2010, Spring Airlines launched its first international route linking its home city Shanghai and Japan's Ibaraki Airport, about 80 kilometers northeast of Tokyo.

2 months later, on September 28, the airline successfully introduced its first flight from Shanghai to Hong Kong with almost full passengers on board. Spring's daily flights from Shanghai to Macau commenced on 8 April 2011 with further international destinations following in the second half of 2011.

Since January 2015, the company has been listed on the Shanghai Stock Exchange.

Spring Airlines also operates a subsidiary in Japan and is the first Chinese airline to do so.

In 2015, Spring announced plans to build a 250-300 room hotel at Chubu Centrair International Airport in Nagoya, Japan, a rare instance of a low-cost carrier entering the hotel business.

The Spring Airlines fleet consists of the following aircraft:

* Airbus A320-200 - 80 Aircraft

* Airbus A320neo _ 1 Aircraft

On June 6, 2014, an Airbus A320 operated by Spring Airlines experienced a runway excursion on the right side of the runway, and striking a light in doing so, the pilot then attempted to go around, but had a tail strike because he pulled up too much at Xiamen, according to another pilot at Spring Airlines.

There were no injuries, but the aircraft sustained substantial damage. An investigation has been opened by China's Accident Investigation Board.


Tourism Observer

ARGENTINA: Air Europa Begins Direct Flights To Puerto Iguazu

Spanish airline will start its flights from Madrid to Puerto Iguazu with weekly frequency operated with the Boeing 787-8, ticket sales started already.

Flight Number UX-45 will depart from Madrid on Saturdays at 23:55 Local Time to arrive in Puerto Iguazu on following day at 07:05 Local Time with a duration of 12:10 minutes and the return of UX-46, will be at 08:35 Local Time, landing at the Spanish capital at 05:10 the next day after a stop in Montevideo.

In addition, the increase of an additional frequency is foreseen with a scale in the opposite direction in the Uruguayan capital, although the date has not been mentioned.

With 2 intense years of negotiations, the Province of Misiones will be able to be connected to Europe through the Hub of the airline in Madrid-Barajas and will further enhance the tourist attractions of the area such as the Iguazu Falls as well as benefit Ciudad del Este with its various shopping centers.

With the addition of Puerto Iguazu, Argentina will become the market with the largest presence in South America, currently flying from Buenos Aires with a daily frequency and Cordoba with a stopover in Asuncion with five weekly frequencies.

Air France-KLM and Air Europa (UX, Palma Son Sant Joan) are set to deepen their existing commercial ties through a tentative joint-venture agreement covering Europe and Central/South America.

The three Skyteam members' current partnership dates back over 15 years and involves codesharing on each other's European services out of Paris CDG, Amsterdam Schiphol, and Madrid Barajas.

A statement issued on Wednesday, August 1, said the parties were currently conducting an integral analysis of the joint venture given the complementarity of their respective networks from/to Central and South America.

Preliminary results show it would provide significant additional benefits to customers in the form of improved connectivity, increased seat availability and a basis to launch new routes and direct flights between the two continents.

The Franco-Dutch carrier group also has strategic partnerships with Virgin Atlantic for transatlantic flights although discussions over strategic cooperation on travel to other parts of the world are underway, Gol Linhas Aéreas Inteligentes in Brazil, China Eastern Airlines, Xiamen Airlines, and China Southern Airlines...

Late last week, lrish low-cost airline Ryanair began offering flights to various destinations at market-breaking prices, including a one-way flight from London to Belfast for €7.

The company is offering a one-way flight from Tel Aviv to Paphos in Cyprus in late October for €20 and a return flight for €32, a €10 discount in each direction.

Flights to Burgas in Bulgaria, for example, are being offered for €34 one-way and €42 for a return flight.

These prices include the flight only, without luggage, with a suitcase costing at least €30 in each direction. The bargain campaign is valid until September 3 at midnight.

A partnership between Ryanair and Air Europa is offering Israelis flights to Miami, Venezuela, Colombia, Peru, and Paraguay with a stopover in Madrid.

For example, a roundtrip ticket to Miami in late October costs €580. Since these flights involve cooperation with a regular airline, in contrast to Ryanair's own flights, the price includes a suitcase weighing up to 23 kilograms and hand luggage weighing up to 10 kilograms.

Following disruptions and cancellations of hundreds of its flights, Ryanair announced that it was recognizing FORSA, the union that its pilots joined.

Ryanair's air teams are distributed among pilots unions in several European countries. The airline's flights in European countries were disrupted by pilots seeking better conditions.

Tens of thousands of the airline's passengers were affected by these disruptions at the height of the vacation season in Europe.

Ryanair announced that 65% of its cabin crew were unionized under agreements recognized by the company. Ryanair's management will now work with representatives of Irish union FORSA.


Tourism Observer

NETHERLANDS: Air France-KLM’s New CEO Be An Aviation Specialist

The entire board of the Air France KLM airline combine are gathered in Amstelveen on Monday and Tuesday to discuss the naming of a new CEO.

There is so much opposition to the naming of Philippe Capron as CEO that the group is now considering naming separate CEOs for the holding company and Air France itself.

The situation within the combine is explosive. Capron’s name emerged last week as a possible new CEO for the group.

But both KLM and Delta Airlines, another shareholder and partner of Air France KLM, object on the grounds that Capron had no experience in the aviation industry nor in the role of CEO.

Like his predecessors at Air France KLM, Capron has a privileged relationship with the French government and is a graduate of the prestigious École nationale d’administration, the FD said.

Air France KLM is seeking a replacement for Jean-Marc Janaillac, who quit in May over lack of support for a new pay and conditions pact.

He was also largely blamed for the many days lost to strikes which cost the combine some €400m so far this year.

KLM is very profitable while Air France keeps running losses which further undermines the fragile alliance.

Meanwhile, Accor is pressing ahead with plans to buy a stake in state-backed airline Air France-KLM, approaching European investors to ask them to team up with the French hotelier, said three people familiar with the situation.

The search for regional partners is in part to address any concerns that Accor could breach EU aviation regulations, which demand that European airlines must have at least 50 per cent of their capital owned by European investors in order to secure their right to fly.

At least a quarter of Accor’s capital is owned by non-European investors, which could prove to be an issue in buying a stake in the French airline, said one person with knowledge of the situation.

European investors could ease any concerns about the extent of overseas ownership of the stake.

Accor earlier this month confirmed it was looking at buying the French state’s 14 per cent stake in Air France-KLM, which is valued at about €430m.

While some Accor investors have said they see an industrial logic to a potential tie-up between Accor and the airline, with the potential for working together in areas such as loyalty programmes, data and technology, some have questioned why Accor needs to spend €430m on a stake to do this.

By teaming up with other investors, Accor could help alleviate these concerns, said a person familiar with the deal.

Accor’s move comes during a turbulent period for the French-Dutch airline which is trying to find a new chief executive to replace Jean-Marc Janaillac, who quit in May after putting his job on the line in an effort to end strikes over pay.

The board of Air-France KLM was meeting in Amsterdam on Tuesday and Wednesday to discuss the chief executive search and the company’s strategy.

Philippe Capron, chief financial officer at French water and waste company Veolia, has been mooted as a favourite for the role among the nomination committee, which is led by Air France-KLM interim chief executive Anne-Marie Couderc.

According to people familiar with the matter, KLM and shareholders Delta and China Eastern Airlines, which each hold 8 per cent of the group, have expressed concern with Mr Capron’s appointment, partly because of his lack of aviation experience.

French finance minister Bruno Le Maire on Sunday suggested the race is still open: Capron is one of the possible candidates but he is not the only one. It takes experience.

The French government, whose 14 per cent stake in the company comes with voting rights of 23 per cent, has said it would like to see a new chief executive of the airline installed before making any decisions on changes to its ownership.

However, that uncertainty could in turn make the hunt for a new chief executive more difficult because candidates already facing a battle with unions may be reluctant to commit before they have visibility on any changes in the group’s shareholder structure.

Chinese tourism company Jinjiang International Company Limited owns about 12.32 per cent of Accor. The Qatar Investment Authority has 10.17 per cent, and 5.69 per cent is held by the Kingdom Holding Company of Saudi Arabia, according to Accor’s shareholder register at December 31.

France’s transport minister on Thursday said it was important that Air France-KLM’s new CEO be a specialist of air transport.

Minister Elisabeth Borne also said that it would be good to appoint the new CEO in July.

French media have reported that KLM, the Dutch airline part of the group, and Delta Airlines - which has an 8.8 percent stake - had expressed opposition toward possible plans to name Veolia chief financial officer Philippe Capron as new Air France KLM CEO over his lack of experience in the sector.

Without getting into more details Borne said Capron was one of the candidates, Air France-KLM is facing global competition and I think it is important that we find someone who is a specialist of the aviation sector and can quickly take leadership in the company, which faces important challenges.

Air France-KLM said on Wednesday that its search for a new chief executive was continuing, adding it hoped to reach a decision “as quickly as possible”.


Tourism Observer

CHINA: China Eastern Airlines Flight From Paris Hits Turbulence In China, 26 Injured

At least 26 people were injured, four of them seriously, when a China Eastern Airlines flight from Paris hit turbulence on Sunday over southwest China.

The incident happened when Flight MU744 from Charles de Gaulle Airport was descending to land at Kunming Changshui International Airport in Yunnan province.

Passengers are being treated for bone fractures, scalp lacerations and soft tissue injuries caused by falling baggage or collisions with overhead lockers, it cited local hospitals as saying.

We felt strong turbulence twice and minor turbulence three times. The process lasted about 10 minutes, a slightly injured passenger surnamed Zhang as said.

The nationalities of the other injured passengers are unclear.

China Eastern Airlines said on its official microblog account that it has arranged medical services but gave no other details.

"(We) remind all passengers, for your safety, please fasten safety belts," the post added.

The airline has not yet publicly come out with any other statement pertaining the accident.

The plane landed around 9 am (0100 GMT) on Sunday, an hour later than scheduled.

"We applauded when the plane landed safely. We feel lucky the plane did not crash," an injured passenger said.

CHINA: ITB China Conference

Over 10,000 pre-scheduled appointments between exhibitors and hosted Chinese buyers secured prior to the show Partner destination Europe travel leaders to share latest ideas at ITB China Conference.

The ITB brand has finally arrived in China: Around 600 companies, destinations, organizations and travel service provider from nearly 70 countries and territories will be represented in China’s new three-day business to business travel trade show.

ITB China will take place annually on the grounds of the Shanghai World Expo Exhibition and Conference Centre in a partnership with TravelDaily China, China’s leading online news portal and event organizer for the travel industry.

The 12,000 qm area of exhibition space has been sold several months ahead of the event.

ITB China is the Chinese off-shoot of annual ITB Berlin, the World′s Largest Travel Trade Show, and its sister show, ITB Asia, in Singapore.

The inaugural event has attracted around 600 exhibitors among which 28% are offering MICE products, 34% leisure, 31% Corporate and 7% travel technology solutions.

More than one third of the exhibitors made their way from all over Asia and China to the first ITB China. Around 40% coming from European countries, 10% from the Middle East and some 10% from the Americas.

Dr. Christian Göke, CEO, Messe Berlin, said: This is an opportune timing for the tourism industry to seize the prospects offered by China’s vibrant economic growth.

ITB China has come at the right time.

Our new marketplace for China’s travel industry creates an international platform with a strong focus on Chinese buyers and sellers and covers everything the industry has to offer – MICE, NTOs, business travel, tour operators, OTA’s and travel tech companies.

Today Dr. Martin Buck, Senior Vice President, Messe Berlin; Eduardo Santander, Executive Director, European Travel Commission; Rungang Zhang, Secretary General & Vice President of China Tourism Association and Jane Sun, CEO, Ctrip.com officially opened the first edition of ITB China during a ribbon-cutting ceremony at the Shanghai World Expo Exhibition and Convention Centre.

Top-quality buyers to be present

ITB China’s exhibitors will engage with 600 top-quality buyers from China. They are coming from all over the country to visit ITB China in Shanghai and represent more than 180 different Chinese companies eager to discover the product range of the show’s exhibitors.

The list of confirmed buyers companies contains some of China’s biggest travel industry players, such as Ctrip, Caissa, Utour, Alitrip and many more. More than 10,000 buyer-seller appointments have been pre-scheduled before the event.

In addition, ITB China expects some 100 international trade buyers adding the event’s buyers numbers up to around 700.

Europe is ITB China’s partner destination and sets the focus on showcasing the variety of the continent’s touristic products.

A dedicated Europe Pavilion will feature a multitude of national presences paired with strong individual attendances of major European destinations.

Eduardo Santander, Executive Director, European Travel Commission said: European destinations acknowledge the need to remain competitive in China.

Only through deeper cooperation with Chinese authorities and an increased commitment of the European tourism sector supporting targeted joint public-private marketing initiatives like the partnership with ITB China, Europe will succeed in fostering more travelers from China.

China Eastern Airlines, being one of China’s top three airlines, is ITB China’s official partner Airline and will be granting exclusive airfares to ITB China’s attendees.

The strong partner line-up is rounded up with the Jin Jiang International Hotels, one of the world’s biggest hotel chains, being ITB China’s official partner hotel will have its brands presented on the ITB China show floor.

Powerful conference program

Attendees of ITB China 2017 can look forward to an exciting conference program. The ITB China Conference is the platform where newest trends and innovation of Chinese and the global travel industry are presented. It runs parallel and will be jointly organized with TravelDaily China.

One of the highlights is the speech of Mr. Rungang Zhang, Vice-Chairman and Secretary General of CTA- China Tourism Association, China’s biggest travel industry association.

The impressive keynote line-up on the opening day of the conference will be furthermore enriched by a keynote held by Mr. Friedrich Joussen, the CEO of TUI Group.

An exclusive CEO interview of Ms. Jane Sun, CEO of Ctrip, will be held by the founder of Phocuswright Inc., Mr. Philip Wolf providing in-depth insights on China’s biggest online travel agency.

HNA Group A Chinese Travel Corporation To Buy Cruise Line

According to a report by Cruise Industry News, Chinese travel conglomerate HNA Group is eyeing the acquisition of an unnamed “major” cruise line.

The rumors of HNA’s potential acquisition of a cruise line sent cruise line stocks soaring, including industry giants such as Royal Caribbean, Norwegian Cruise Line, and Carnival Corp.

The potential move follows a busy last week for HNA Group, when it acquired a 16.79 percent stake in travel retail giant Dufry, as well as acquired a substantial stake in Rio de Janeiro’s Galeo airport. HNA Group previously had an unsuccessful foray into the cruise industry with the HNA Cruises brand and its MS Henna, which was sold for scrap in 2016. HNA cruise operations were suspended in 2015.

Even though HNA’s unsuccessful attempt to penetrate China’s domestic cruise market may be cause for skepticism about the rumored acquisition of an international cruise line, it wouldn’t be the first time HNA makes a substantial investment in a tourism industry giant.

In October last year, HNA Group acquired a 25 percent stake in Hilton Worldwide for $6.5 billion, only a few months after acquiring Carlson Hotels—owner of Radisson hotels. The company holds substantial investments in airlines, airports, airport services providers, duty-free operators, and even owns the third-largest stake in Deutsche Bank.

After withdrawing from China’s cruise market in 2015, it is currently left without a stake in China’s growing cruise market.

According to the Cruise Lines International Association (CLIA), China’s cruise industry grew at an annual compounded rate of 66 percent between 2012 and 2015, making it the fastest growing cruise tourism market in the world.

Market leaders in the cruise industry have reacted accordingly, repurposing ships for the Chinese market, building new ships designed with the Chinese market in mind, as well as entering joint ventures with Chinese partners to boost growth and domestic ship construction in China.

The Chinese government is also one of the biggest cruise industry stakeholders with various state-owned enterprises owning stakes in domestic cruise brands and shipbuilding plants.

Among the major players in the market is a domestic cruise brand owned by Carnival Corp, state-owned China State Shipbuilding Corporation (CSSC), and China Investment Corporation.

For HNA Group, it wouldn’t be the first time it goes into a market where the Chinese state has significant interests. HNA Group’s Hainan Airlines is the largest privately-owned airline in China, trailing only state-owned Air China, China Eastern Airlines, and China Southern Airlines, and has enjoyed substantial growth as a result of the booming popularity of international tourism in China.

With the growth of cruise tourism outpacing overall tourism growth in China, buying a significant stake in one the Chinese cruise market’s many suitors could present an exciting prospect for HNA Group in its search for future growth through acquisition.

With competition in the Chinese cruise market heating up, HNA Group and its strong foothold in China’s tourism industry could also present an ideal partner for cruise lines looking to China and Asia for future growth.

CHINA: Ever Growing Tourism Makes China World's Fastest Growing Aviation Market

The fortunes of China's largest airlines have risen with the ascent of the Chinese travelers, whose demand for overseas trips have helped make it the world's fastest-growing aviation market.

However, the airlines took many U.S. dollar-denominated loans to buy planes as part of an ambitious fleet expansion, exposing them to the depreciation of the yuan which lost 6.6% of its value against the dollar last year.

Oil prices, which plunged in recent years, have also started to firm, causing jet fuel costs to begin to rise.

China's flag carrier on April 27 posted profit attributable to shareholders of RMB 1.47 billion (USD 213 million) for January to March, down from RMB 2.4 billion during the same period last year.

Its domestic rival China Eastern Airlines said net profit attributable to shareholders was RMB 2.82 billion for the quarter, up from RMB 2.6 billion a year earlier.

China's top economic planner has approved China Southern Airlines' 14.8-billion-yuan ($2.15 billion) plan for a base at a new Beijing airport currently under construction, a day after it approved a similar scheme by China Eastern Airlines.

The National Development and Reform Commission (NDRC) said in a statement on Friday that China Southern will fund 30% of the construction cost, while the remaining RMB 10.3 billion will be financed using domestic bank loans.

China Southern Airlines plans to build a 14.8-billion-yuan (USD 2.15 billion) base at a new Beijing airport, while China Eastern Airlines has a similar plan at 13.2 billion yuan.

China Eastern's 13.2-billion-yuan plan for a similar base at the new airport was given the green light on Thursday.

The airport will be the world's largest in surface area when completed, roughly in line with Hartsfield-Jackson Atlanta International Airport, the world's busiest by number of annual passengers.

China's economic planner approved China Eastern Airlines' 13.2-billion-yuan (1.54 billion pounds) plan for a base at an expansive new airport in Beijing that could eventually be the world's largest, when completed.

The National Development and Reform Commission said in a statement on its website that the base will cover 1.17 million square meters, and 30% of the investment, or RMB 3.96 billion, will be funded by China Eastern.

The remaining RMB 92.4 billion will be financed using domestic bank loans, the statement added.

China plans to complete the first phase by 2019, and will be able to serve 45 million passengers a year with four runways on the first opening. Two more phases would push the capacity to an annual count of 100 million passengers.

That would put the airport as the world's largest in surface area, roughly in line with Hartsfield-Jackson Atlanta International Airport, the world's busiest by number of annual passengers.

Upon completion, rival state carrier, China Southern Airlines, will also relocate to the new airport from the existing Beijing Capital International Airport, the airport project managers told reporters last year.

They said China Eastern and China Southern will handle 40% of the new airport's footfalls.

Beijing Capital International Airport (Beijing PEK) ranked second in the top 20 busiest airports last year, growing 5% to over 94 million passengers in 2016.

Beijing Capital International Airport (Beijing PEK) ranked second in the top 20 busiest airports last year, growing 5% to over 94 million passengers in 2016, according to Airports Council International (ACI), global trade representative of the world’s airports.

Atlanta-Hartsfield-Jackson (ATL) retained the top spot as the world’s busiest airport, boasting over 104 million passengers, 2.6% more than 2015.

Beijing PEK saw subdued growth in previous years as it faced continuing capacity constraints. Conversely, ATL experienced above average growth levels spurred by aircraft fleet expansions in 2015 by Delta Air Lines, its major operator.

Traffic at the world’s 20 busiest air passenger hubs grew 4.7% in 2016. With over 1.4 billion passengers passing through their airports in 2016, this group of 20 represents 18% of global passenger traffic.

Asian airlines continued to make important inroads in the North American market on key international and trans-Pacific segments across airport pairs, particularly between North America and China.

One of the major Chinese airports serving the trans-Pacific routes and other international routes includes Shanghai Pudong (PVG), which grew 9.8% in 2016 to over 66 million passengers. It climbed to ninth place in 2016.

The Chinese hub also serves the catchment area of Shanghai, one of the most populous city markets in the world and a major centre for trade and business. PVG, which represents over 60% of Shanghai’s passenger traffic in 2016, and Hongqiao (SHA), the city’s sister airport, surpassed the 100 million passenger mark in combined passenger traffic.

Shanghai joined the ranks of the world’s busiest city markets in 2016, in the company of London, New York, Tokyo and Atlanta.

The Chinese government has selected China Eastern Airlines to be part of a pilot scheme to reform state-owned enterprises to mixed Public/Private ownership models.

The scheme, which is being rolled out in a slow and controlled manner, is intended to reinvigorate China's bloated public sector by creating globally competitive multinational corporations capable of turning a profit by 2020.

As part of the first pilot reform scheme, the National Development and Reform Commission (NDRC) and the State-owned Assets Supervision and Administration Commission (SASAC) have included a broad spectrum of SOEs. Aside from China Eastern, they include China Southern Power Grid, Harbin Electric Corporation, the China Nuclear Engineering & Construction Corporation, and China Shipbuilding Industry Corporation. More precise details will be released shortly the official Xinhua news agency said last week.

The reform process has been in motion for a few years, with China Eastern selling a 3.55% stake to Delta Air Lines back in 2015 for USD450 million. China Southern is also in the process of securing regulatory approval for the sale of a 2.76% stake to American Airlines.

HONG KONG: Passengers Kept Awake And Hungry At Hong Kong International Airport

A combination of military drills and bad weather in eastern China left thousands of passengers headed for Shanghai and nearby cities stranded at Hong Kong International Airport for more than 12 hours.

At least 13 flights scheduled for Shanghai Pudong International Airport from 10.55am were still grounded at the airport by 9pm. Passengers with Cathay Pacific, Dragonair, Hong Kong Airlines, China Eastern Airlines, Juneyao Airlines, and Spring Airlines were affected.

No flights departed for Shanghai Pudong International Airport from Hong Kong after 10am because of a combination of air traffic restrictions over eastern China caused by a military drill in the morning and rainy weather in the afternoon, according to airport ground staff.

Zhang Jun, a Dragonair passenger who was having his 50th birthday, was one of many passengers who had been waiting since 4pm. “My biggest birthday wish is to leave now,” he said, standing next to the airline’s counter as it was besieged by angry passengers.

Zhang said he is a frequent traveller to Shanghai but has never seen delays of this kind.

“I have lots of experience with delays on the mainland caused by air traffic control. What I cannot accept is being given new departure times every two hours. If there is no departure time, tell us there is no time.”

A Cathay manager at the scene denied the departure times were arbitrarily set but said they were based on possible departure slots from Shanghai air traffic control.

Passengers in transit who had come from long-haul flights from New York, New Delhi and Singapore complained Cathay Pacific and Dragonair had kept them awake too long without offering any place to rest, nor any food or drink while waiting, endangering their health. They were unsatisfied with the airlines’ explanation of the situation and demanded compensation.

“We are a group of 19 seniors. Many of us have not slept for nearly 24 hours. Now it’s 10pm, we do not want to leave anymore and just want to be put in a hotel and rest. They kept lying to us by giving us new times and keeping us waiting here,” said Ren Hongxing, a 70-year old man from Shanghai who was returning from a Malaysia-Singapore tour via Hong Kong.

Passengers on his flight had boarded and waited for four hours on the aircraft before being offloaded. A delay certificate issued by Dragonair said the flight - originally scheduled for 1pm - was delayed because of “adverse weather” and “air traffic flow control”.

Dragonair ground staff said “Shanghai has given us no time. We do not know if and when a flight could take off.”

Air traffic controls over eastern China last summer caused delays of up to 15 hours at the Hong Kong international airport.

Cathay cancelled CX5808/KA808, a Shanghai Pudong bound flight originally scheduled for 4:55pm, at around 10pm. By 11pm, passengers on the 10:55am CX 5804/KA804 flight had boarded the plane but still did not take off.

Hundreds of passengers from three other Shanghai-bound flights were still waiting near midnight in the hope of getting a chance to depart.

As of 9am Wednesday morning, all flights had been rescheduled and many were still waiting to depart.

China Eastern Airlines

About China Eastern Airlines
China Eastern Airlines is majority owned by the Chinese government, and is ranked as a 3-Star Airline. The international hub for China Eastern Airlines is Shanghai Pudong Airport and Shanghai Hongqiao Airport for domestic flights. China Eastern Airlines is a member of SkyTeam Alliance.

China Eastern Airlines fleet
China Eastern Airlines has a large aircraft fleet, and long haul international flights are normally operated by their newer Boeing 777-300ER aircraft and Airbus A330 aircraft.

Shanghai Pudong Airport
The main airport used by the airline is Shanghai Pudong International Airport. The Shanghai Maglev Train links Pudong International Airport with Longyang Road Metro Station, from where downtown connections can be made. International and domestic flights operate from Pudong International Airport, although the main China Eastern Airlines base for domestic flights is Shanghai Hongqiao Airport, which is much close to downtown Shanghai. Shanghai Hongqiao Airport is next to Shanghai Hongqiao Railway Station, a major train hub served by the Beijing–Shanghai High-Speed Railway.

Shanghai Pudong International Airport has two main terminals, Terminal 1 and the newer Terminal 2 – walking time between the terminals is about 15 minutes. China Eastern Airlines operates from Terminal 1, as does its subsidiary, locally based airline, Shanghai Airlines.

China Eastern Airlines ground service
Check in service is at a reasonable standard in Shanghai Pudong Airport, and there are many self-serve check-in facilities. Waiting times for check-in at Shanghai Hongqiao tend to be slowest for peak period domestic flights. If you need English language assistance at check-in, many staff have adequate language skills or they can call a supervisor.

China Eastern Airlines domestic First class lounge at Shanghai Hongqiao Airport is quite spacious, but at peak departure times you may find it hard to locate a free seat space. Lounge catering is supplied by an outside, Western hotel chain and the standards are quite good. WiFi is available, although speeds mirror many Chinese airport standards by being slow.

The international First and Business Class lounges at Shanghai Pudong Airport are quite limited, and will be replaced in the coming years with a new facility. They are made up of several lounge choices, each being quite small and lacking in facilities that you would expect at a major global hub. Not the place to relax for long periods, and don’t expect much in the way of business facilities or in-lounge catering options.

Onboard China Eastern Airlines
On international flights, China Eastern Airlines offers First class, Business and Economy class on some aircraft, whilst others will have just a Business Class and Economy Class cabin.

First Class
The new Boeing 777-300ER aircraft provides seat pod style flat bed seats, in a 1x2x1 layout. The seats are spacious, offer good privacy and there is a large IFE screen. A nice duvet and pillow is supplied. The onboard catering is ranked 3 to 4-Star standards, and normally the Chinese menu is of a better standard than the Western meal options. A good choice of wines are available. An amenity kit is provided, slippers and nice pyjamas (it is advisable to select the largest size for comfort). Cabin staff service can be good, but there are variations and a lack in service consistency. Most cabin staff have some understanding of English, and staff language skills are improving year on year. The language skills are based around a standard set of phrases, and you may find that staff will not understand if you go off-script. The choice of reading materials is limited – you get English language Chinese newspapers offered, and maybe Time of Newsweek, but little other choices are available. The IFE system is reasonable on newer Boeing 777-300ER aircraft, and a choice of Western movies is offered, as are Western TV programmes. However, don’t expect much in the way of new releases and many movies are quite old.

Business Class
The newer Boeing 777-300ER aircraft offer nice flat bed seat pods, arranged in a 1x2x1 layout. There are older angled-flat seats on Airbus A330 aircraft. A nice duvet and pillow are provided. Pyjamas are not provided, but you receive an amenity kit and slippers. The onboard catering is quite similar to First Class (apart from some presentation format difference), and you will probably find that Chinese menu standards are better than Western options. Cabin staff service is efficient through the meal services, and same comments apply to language skills. The IFE system is patchy, and you may find that the responsiveness is very slow. Choice of reading materials is limited – you will get English language Chinese newspapers offered, and maybe Time of Newsweek, but little other choice. The IFE system is reasonable on newer Boeing 777-300ER aircraft, and a choice of Western movies is offered, as are Western TV programmes. However, don’t expect much in the way of new releases and many movies are quite old.

Economy Class
China Eastern Airlines Economy class seats provide a reasonable comfort level, with an average seat pitch and legroom. For the Cabin Seat Layout plans, we suggest you refer to our Airline Seat Plans guide where you can view China Eastern Airlines aircraft cabin layouts. A blanket and pillow are provided, both at a 3-Star quality level. The Economy class onboard catering is ranked at 3-Star standard, with a choice of Chinese or Western meal options. Quantity of food supplied is okay, but don’t expect culinary delights on most routes. Chinese tea is served with the meal and you might have to repeatedly request from staff if you want to get a beer or wine served – and these are often served warm and not chilled. The cabin staff tend to be younger in this cabin (compared to First or Business) and most of them are enthusiastic and offer a pleasant demeanour. They are trained with standard English language phrases, and you may find that some questions you ask are met by puzzlement – persevere and they will normally get an English speaking member of staff to help. The IFE system is reasonable on newer Boeing 777-300ER aircraft, and a choice of Western movies is offered, as are Western TV programmes. However, don’t expect much in the way of new releases and many movies are quite old.

Domestic Flights
The majority of China Eastern Airlines domestic flights are operated by narrowbody Airbus A320/321 and Boeing 737 aircraft types, although some busier routes may use Airbus A330 aircraft. The onboard narrowbody product comprises First / Business Class seats configured 2×2, and standard Economy 3×3 seating. A proportion of these China Eastern aircraft are quite dated and worn inside the cabin, with well-used seats and cabin décor. In contrast to Air China, China Southern and Hainan Airlines, many of these domestic China Eastern Airlines aircraft seem rather tatty in appearance and presentation. A meal or snack is normally served in both cabins, subject to flight duration – shorter 60-90 mins flights and you are lucky if you receive even a beverage in First Class.

Cultural Differences
It is worth remembering that there are clear cultural differences amongst many Chinese travellers, and some of these may be disconcerting to western customers. This is an area that the Chinese government has been trying to address in recent years, and in 2013 the China National Tourism Administration published a 64-page Guidebook for Civilized Tourism (encouraging better manners). As far as air travel is concerned, you are likely to notice that queuing is often disorderly and when for example flight boarding is announced, there can often be a rapid stampede of travellers pushing and shoving to get through the gate quickly. Loud talking (almost shouting) is another trait you might find disconcerting both on the ground and onboard flights. Spitting remains an issue despite educational promotions to stop this. Despite airline’s best efforts to keep passengers seated after landing, you may also find a number of passengers standing up to retrieve luggage whilst still taxiing. We guess that bit by bit such practices will gradually improve in coming years, but don’t forget there are 1.4 billion potential Chinese travellers.

VERDICT
China Eastern Airlines is playing catch-up from a quality perspective when compared to China Southern Airlines and Air China (as one of the 3 Government owned airlines), and their new fleet additions on long haul routes offer a considerable improvement. You would not choose a Chinese airline if you must have standard western food and amenities during a flight, and it is also important that you don’t expect every member of staff to be able to chat to you in English (or other language). Staff are generally well trained and provide service in quite a regimented and disciplined manner, and remember, they often have to deal with very demanding Chinese customers. China Eastern Airlines is a good choice if you are planning a trip to China and want to fly into Shanghai, although their standards are currently not meeting the 4-Star quality of China Southern Airlines or the top 5-Star quality of Hainan Airlines.

CHINA: China Eastern Airlines Boosts North America Capacity

China Eastern Airlines plans to boost its capacity to North America by 50 per cent in 2016 to tap the rapidly growing travel market between China and the US in the China-US tourism year, chief executive Ma Xulun said in an interview with the South China Morning Post on Friday.

“Air travel between the two countries is expected to rise to more than 5 million passengers this year, with about 3 million being US-bound from China. We have great confidence in the market and hope to capture as much of this opportunity as possible,” Ma said.

He added that the airline is also looking to capture more than half of the 3 to 4 million additional air travellers expected after Disneyland Shanghai opens in June.

China Eastern last year introduced Delta Airlines as a 3.5 per cent strategic shareholder in a landmark deal worth US$450 million.

China Eastern transported 1.12 million passengers on China-US routes last year according to Dong Bo, chief marketing officer and general manager of its marketing and sales committee. “Our capacity increase in 2016 will be about 50 per cent,” Dong said.

The mainland Chinese airline on Wednesday reported a 33 per cent profit rise to 4.54 billion yuan (HK$5.4 billion) in 2015. Ma said all of China Eastern’s US routes turned in profits last year and that flights to New York and to Los Angeles were among its top 10 most profitable routes.

Analysts have expressed concerns about overcapacity as mainland airlines vie to capture the Chinese outbound travel market by aggressively adding international flights. Passenger yield, a unit profitability indicator, dropped at all the big three Chinese airlines in 2015.

China Eastern’s net yield on international routes dropped 3.9 per cent on international routes – the least among its peers. Still, competition and currency headwinds brought a loss of 800 million yuan in the last quarter of the year at China Eastern and a 900 million yuan loss at China Southern.

“There will be downward pressure on ticket prices in the short term,” said Dong. “But China-US traffic rights are near exhausted, so supply growth is capped. We expect oil prices to stay low this year, so it is possible to achieve further bottom line improvement.”

China Eastern is currently the third largest operator on China-US routes after United Airlines and Air China. Ma said China Eastern’s capacity will grow to be near Air China’s this year. He said they are seeking to deepen its partnership with Delta by expanding flight codeshares and moving to joint operations this year.

“We have formed strategic partnerships in the key markets of US, Europe and Australia with Delta, Air France-KLM, and Qantas respectively. This year’s focus will be to deepen our ties,” Ma said.

China Eastern had 590 planes at the end of last year. It suffered an exchange loss of nearly 5 billion yuan last year – a 24-fold rise – because the yuan depreciation multiplied the interest it had to pay on its 87.3 billion yuan worth of US-dollar denominated debts.

Chief financial officer Wu Yongliang said the airline has set a target to bring down its US-dollar debt level to 50 per cent from 53 per cent now through currency swaps to renminbi, and will also increase its yuan financing channels through low interest-rate, short-term commercial paper.

The company did not declare any dividend because of a pending 15-billion yuan private placement plan. “We plan to complete that first and use no less than 40 per cent of 2015 profit for dividend payment at 2016 interim,” Wu said.

INDIA: Airbus Signs MoU With IndiGo For 250 A320neos

Gurgaon, India-based IndiGo today signed a major Memorandum of Understanding (MoU) for 250 firm Airbus A320neos, the manufacturer’s single-largest aircraft order. IndiGo is a domestic and international low-cost carrier founded by Rahul Bhatia of conglomerate InterGlobe Enterprises and Rakesh Gangwal, the former chairman and CEO of US Airways from 1998 to 2001.

The carrier, based at Delhi Indira Gandhi International Airport, currently has 83 A320-200s. It has existing orders for 280 Airbus aircraft — 100 A320ceos and 180 A320neos. IndiGo serves 31 cities in India, along with flights to Bangkok, Dubai, Kathmandu, Muscat and Singapore for a total of 540 daily flights. The airline’s business model resembles that of Southwest Airlines — one common fleet type, a focus on keeping costs low and an obsession with on-time operations.

Since its beginnings in 2006, IndiGo has been the fastest-growing carrier in India. Among domestic airline in the second quarter, IndiGo’s market share was 31.6 percent, the best among its competitors, according to India’s Directorate General of Civil Aviation. Air India was 18.5 percent while SpiceJet was 18.3 percent.

The aircraft covered under the MoU includes what Airbus calls the “new engine option,” along with large sharklet wing-tip devices, which offer carriers 15 percent in fuel savings now and up to 20 percent by 2020. Airbus currently has orders for 49 A319neos, 2,494 A320neos and 729 A321neos from carriers including Swiss, Eurowings, JetBlue, China Eastern airlines and Air New Zealand.

UAE: Emirates Large Aircraft To Guangzhou Piss Of Chinese

Emirates, the world’s biggest long-haul airline, plans to deploy the Airbus A380 jumbo jet on routes to the southern Chinese city of Guangzhou as it tries to differentiate its offerings to fend off Chinese rivals.

"Guangzhou is a potential destination for the two-class A380," Badr Abbas, Emirates’s senior vice president of commercial operations in the Far East, said in an interview Tuesday in Hong Kong. The carrier is awaiting Chinese government approval to deploy the world’s largest jumbo jet, which can seat 615 people in a dual business and economy configuration, replacing the Boeing Co. 777-300 ER the airline now uses on its daily Guangzhou flight, he said.

Chinese airlines such as Air China Ltd., China Eastern Airlines Corp and Hainan Airlines Co. are expanding their networks, adding direct international connections from leading cities such as Beijing, Shanghai and Guangzhou as well as secondary cities such as Chengdu. That’s proving tough competition for Emirates, which relies on connecting traffic into its Dubai hub to feed on to flights to Africa, Europe and beyond.

Chinese carriers have more market share, given various factors such as direct flights and more desirable flight times, Abbas said. Guangzhou, with its strong African business ties, is a city that provides connecting traffic for Emirates flights to Africa, Europe and the Middle East from Dubai. In August, state-backed China Southern Airlines Co. started direct flights to Nairobi from its Guangzhou base.

Emirates currently operates two daily flights each from Beijing and Shanghai, split evenly between the Airbus A380-800, with 517 seats, and a Boeing 777-300ER that seats 364. By deploying more A380s on flights from Dubai to Beijing, Shanghai and Guangzhou, Abbas said the airline can raise its China capacity by 46 percent without adding any more airport slots.

Abbas said the number of Chinese passengers flying to Dubai as their final destination rose 25 percent in the financial year that ended March 31. Emirates operates 35 weekly flights for the mainland Chinese market, with a load factor of 84 percent in that fiscal year, he said.

Switching to a two-class configuration, which means eliminating first class, will help Emirates cater to the larger percentage of business and leisure travelers from Guangzhou, Abbas said. The company doesn’t know when it will receive approval for its plans and is also awaiting the outcome of talks between the United Arab Emirates and China to see if it can add new destinations on the mainland, Abbas said.

"We have good growth in the Chinese market and we’re seeking to grow our capacity," Abbas said. "The A380 is key for us to grow."

World's Largest Airlines

DELTA AIR LINES remains the world’s most popular carrier, according to the latest data released by IATA, an aviation trade group. Delta carried 129.4m passengers last year, putting it a nose ahead of second place Southwest. Only one of the world's five largest carriers was not American—third-placed China Southern flew 100.7m people in 2014. Yet, tellingly, on international routes just two American carriers squeaked into the top ten—United and Delta in ninth and tenth positions respectively. Both flew a fraction of the international passengers of the market leader, Ryanair, which hauled 86.4m people across national borders.

Of course, this shouldn’t be surprising. America is the world’s biggest domestic aviation market. What it does show, however, is how ridiculous it is for US carriers to whinge about competitors from other countries apparently receiving state aid—particularly supercarriers in the Middle East. After all, having their own domestic markets protected by the state is the primary reason that American airlines thrive. Ask United or Delta whether they would welcome competition on their JFK:LAX route from Emirates or Singapore Airlines. If they were being honest, they would admit that the last thing they want is a truly level playing field.

World's largest airlines by passengers, 000
1. Delta Air Lines 129,433
2. Southwest Airlines 129,087
3. China Southern Airlines 100,683
4. United Airlines 90,439
5. American Airlines 87,830
6. Ryanair 86,370
7. China Eastern Airlines 66,174
8. easyJet 62,309
9. Lufthansa 59,850
10. Air China 54,577

World's largest airlines by international passengers, 000
1. Ryanair 86,370
2. easyJet 56,312
3. Lufthansa 48,244
4. Emirates 47,278
5. British Airways 35,364
6. Air France 31,682
7. Turkish Airlines 31,016
8. KLM 27,740
9. United Airlines 25,708
10. Delta Air Lines 24,243

CHINA: China Eastern Airlines Receives Its 50th A330

China Eastern Airlines has taken delivery of its 50th A330 aircraft at a ceremony celebrated on Friday 18th in Toulouse, France. Powered by Rolls Royce Trent 700 engines, the A330-200 features a comfortable two class cabin layout seating 30 passengers in business class and 203 in economy.

“We are very happy to take delivery of this 50th A330. It symbolically represents our 30 years of partnership with Airbus. With high efficiency, high economic performance and unrivalled comfort, the A330 gives our passengers an unrivalled flying experience,” said Ma Xulun, General Manager of China Eastern Airlines. “The A330 has been key to our expansion and competiveness in international markets. We are looking forward to many more passengers to fly Airbus aircraft while enjoying the best service from China Eastern.”

“With a fleet of that has grown to 50 A330s over nine years, China Eastern is demonstrating its continued confidence in the superior performance and comfort of the A330,” said Fabrice Brégier, Airbus President and CEO, “We are confident that with one of the world’s largest A330 fleets, China Eastern will strengthen its position as one of Asia’s leading international carriers and continue to offer its passengers the best flying experience.”

China Eastern began operating the A330 in 2006 and today its fleet has grown to be one of the world’s largest. China Eastern also operates a fleet of around 230 single aisle A320 Family aircraft, taking its Airbus fleet to some 280 planes in total. China Eastern is one of Mainland China’s three major airlines.

The A330 is one of the most popular wide-body aircraft with over 1,500 orders, and over 1,200 delivered to some 110 operators worldwide. Offering the lowest operating costs in its category, and thanks to continuous investment and innovations, the A330 is the most profitable and best performing aircraft in its class, with an average operational reliability of 99.4 percent.

CHINA: Government To Merge Sectors Of 3 Largest Carriers

China Southern Airlines
Type Scheduled Carrier
Base Guangzhou
Aircraft 516
Destinations 208
Routes 867
Daily Flights 1732

The Chinese government is considering merging certain sectors of the country's three largest carriers - Air China (CA, Beijing Capital), China Southern Airlines (CZ, Guangzhou), and China Eastern Airlines (MU, Shanghai Hongqiao) - into one, informed sources have revealed.

As part of the country's 13th Five-Year Plan covering 2016 to 2020, China's Supervision and Administration Commission (SASAC) last month unveiled far-reaching reforms which aim, through the consolidation of state-owned companies, to create globally-competitive multinational corporations capable of turning a profit by 2020.

As such, the merger of the three airlines' passenger operations is only one aspect of consolidation under review with others said to include combining only two of three's passenger operations. In June, the deputy director of the Civil Aviation Administration of China (CAAC) Zhou Laizhen alluded to the creation of Asia's largest air-freight transport company through the proposed merger of China Eastern's China Cargo Airlines (CK, Shanghai Hongqiao), Air China Cargo (CAO, Beijing Capital), and the cargo division of China Southern Airlines.

Historically, all three carriers stemmed from China's previous, de-facto state enterprise - CAAC (Beijing Capital) - which Beijing unbundled into six trunk operators - Air China, China Eastern, China Southern, China Northern Airlines (CJ, Shenyang), China Southwest Airlines (SZ, Chengdu), and China Northwest Airlines (WH, Xi'an Xiguan) - in 1987 as part of Deng Xiaoping's market reforms. However, to better streamline operational efficiencies, China Southwest was eventually merged into Air China in 2002, China Northwest into China Eastern also in 2002, while China Northern was absorbed by China Southern in 2004.

The privately-owned HNA Group has unveiled a similar policy with plans to transfer control of four carriers - Tianjin Airlines (GS, Tianjin), West Air (China) (PN, Chongqing), Capital Airlines (China) (JD, Beijing Capital), and Hong Kong Airlines (HX, Hong Kong Chek Lap Kok) - to Hainan Airlines (HU, Haikou) in a bid to improve profitability, boardroom excellence, and avoid horizontal competition among its subsidiaries.

CHINA: China Southern Airlines Executive Vice-President Removed Over Bribery Probe

China Southern Airlines said on Friday evening that its executive vice-president Liu Qian had been removed from his position while a corruption investigation against him is under way, after the South China Morning Post reported on Monday that Liu had been taken away.

"A case on file for investigation against Liu Qian has been placed due to the suspicion of bribery crime. According to the relevant laws and regulation and the articles of association of the company, all eleven directors of the board considered and unanimously approved that Liu Qian be removed as the executive vice president of the company. The above matter does not affect the ordinary operation of the company," China Southern said in a notice to the Hong Kong stock exchange.

Liu, who was overseeing operations, is the fifth senior executive to fall at China's largest airline since a graft probe began late last year. In January the company announced four senior executives – chief financial officer Xu Jiebo and deputy managers Chen Gang, Zhou Yuehai and Tian Xiaodong – were removed and detained for “job-related crimes”, a euphemism for corruption.

Liu, 52, a veteran pilot, joined the airline in 2004 from the Civil Aviation Administration of China (CAAC) according to China Southern’s website. He received remuneration of 1.397 million yuan last year according to the company’s annual report, making him the highest-paid manager.

In April, Liu received a “serious warning” from the party and an administrative sanction for playing golf on public funds, while Zhang Zhong and Lin Qingtong, two managers at China Southern's Zhuhai Flight Training Centre, were also warned and made to return the funds, according to a notice on the website of the Central Commission for Discipline Inspection (CCDI). But it is understood Liu’s job had not been affected by the warning and he had been performing his role since April.

China’s booming aviation industry is among the latest targets of Communist Party graft busters who have been examining state-owned enterprises and government bodies across the mainland. The probe into the airline sector started with a visit to China Southern by the CCDI.

CAAC, Air China and China Eastern Airlines were among copmpanies visited by the CCDI in the latest round of inspections that started in July. At least three CAAC officials have since been taken away on suspicion of corruption according to mainland media.

Beijing Capital Airport said in a notice to the Hong Kong stock exchange on September 17 that its general manager, Shi Boli, had resigned from his post and all directorships at the company, after media reports emerged that Shi, a former CAAC official, had also been taken away for investigation.

CHINA: Comac C919 Plane Manufactured In China With Western Parts

Comac C919
Role Narrow-body twin-engine jet airliner
National origin People's Republic of China
Manufacturer Comac
Designer Comac
First flight 2016 (Projected)
Introduction 2015
Status Introduced
Number built 1

The Comac C919 is a planned family of 158–174 seat narrow-body twin-engine jet airliners to be built by the Commercial Aircraft Corporation of China (Comac).It will be the largest commercial airliner designed and built in China since the defunct Shanghai Y-10. Its first flight is expected to take place in 2015, with first deliveries scheduled for late 2018.

The C919 forms part of China's long-term goal to break Airbus and Boeing's duopoly, and is intended to compete against Airbus A320, Boeing 737 and Irkut MC-21. As a long term plan the twin‑engine, twin aisle C929 and C939 are proposed, offering 300 and 400 seats, respectively.

Comac applied for a type certificate for the aircraft from the Civil Aviation Authority of China on 28 October 2010. The company plans to conduct the first flight of the C919 in 2015, with deliveries beginning in 2017, whereas Marwan Lahoud, Chief Strategy & Marketing Officer of Airbus Group, assumes a competition outside China around 2020.

In June 2011 COMAC and Irish low-cost airline Ryanair signed an agreement to co-operate on the development of the C91] On 24 November 2011, Comac announced the completion of the joint definition phase, marking the end of the preliminary design phase for the C919. The company said it planned to cut the first metal for the aircraft in December 2011, with estimated completion of the detailed design phase in 2012.

With an estimated development cost of $8.3 billion, Comac planned to produce 5–10 planes per year in 2016 and 2017, subsequently ramping up to 150 C919s.[13] The company intends to manufacture up to 2,300 aircraft of that type.

In 2014 delivery was yet again delayed by technology and supplier problems, this time to 2018. Comac rolled out its first C919 aircraft off the assembly line in September 2015 with no engines installed.

On November 2, 2015, Comac rolled out its first C919 aircraft.

Design and assembly of the aircraft will be done in Shanghai, using foreign-made jet engines and avionics. However, China has expressed its desire to produce a domestically made engine for the C919.

The center wing box, outer wing box, wing panels, flaps and ailerons are planned to be built in Xi'an, China. The center fuselage sections are planned to be built in Hongdu, China. The airframe will be made largely of aluminium alloy, while the center wing box also makes use of carbon fiber composites.

CFM International will supply a version of the LEAP engine, the LEAP-1C, to power the aircraft. The engine's nacelle, thrust reverser and exhaust system will be provided by Nexcelle, with such features as an advanced inlet configuration, the extensive use of composites and acoustic treatment and an electrically operated thrust reverser. Michelin will supply Air X radial tyres.

Dimensions of the C919 are very similar to the Airbus A320, possibly to allow for a common pallet to be used. Its fuselage will be 3.96 metres (13 feet) wide, and 4.166 metres (13 feet, 8 inches) high, producing a cross-section of 12.915 square metres (139 square feet). The wingspan will be 33.6 metres (110 feet, 3 inches), or 35.4 metres (116 feet, 3 inches) if winglets are included.

Payload will be 20.4 metric tonnes. Its cruise speed will be Mach 0.785 and it will have a maximum altitude of 12,100 metres (39,800 feet).

There will be two variants. The standard version will have a range of 4,075 km (2,200nm), with the extended-range version able to fly 5,555 km (3,000nm).

According to a film shown by Comac at the 2010 Zhuhai Airshow, the company plans to build six different models of the aircraft: a base passenger aircraft with 168 seats, as well as stretched and shrunk passenger versions, business jet and freighter models, and a type designated only as "special".

The Comac C919 is intended to be a new entrant in the commercial airliner market specifically targeted at low-cost airlines. Fuel price increases are especially damaging to the low-cost flying model, leading these airlines to renew their fleets frequently.

This ensures optimal fuel performance and reliability across a single-type fleet. Direct competitor – Boeing 737 unit cost of US$ 78.3-108.3 million, means that target price for this airplane should be lower. The Airbus A320 has a wider price range, from US$71.9 million to US$120.5 million. The Comac developers have not announced a price tag for each plane, although based on industry speculation current orders for 2012 could be worth more than US$26 billion.This with 2012 orders for 380 examples, lead to projected average price of about $68 million.

Some experts believe the C919 will not be competitive either technologically or commercially when it enters service given the planes' strong dependence on foreign suppliers. In particular, the engines will likely be sourced from CFM International Inc. (LEAP-X1C engine), the same company that sells the CFM International CFM56 used by direct competitors.In 2013, state-owned newspaper Global Times complained that an Aviation Week editorial about the bleak prospects for the aircraft "maliciously disparaged the future outlook for the C919."

At the 2010 Zhuhai Airshow, Comac announced orders for 55 C919 aircraft from six airlines, with an additional 45 options. The purchasing airlines or lessors included China Eastern Airlines, Air China, Hainan Airlines, China Southern Airlines, CDB Leasing Company, and GE Capital Aviation Services.

On 20 October 2011, Chinese leasing company ICBC Leasing announced an order for 45 C919s, as well as an agreement to be the launch customer for the aircraft.On November 11, 2014, Comac announced at the 2014 Zhuhai Airshow that China Merchants Bank's aircraft leasing division made a firm commitment for 30 C919s, and that total orders were now up to 450 aircraft.

Production of the first C919 testing prototype began on December 9, 2011. The flight testbed was expected to enter final assembly in 2014, and perform its first flight sometime in 2015. However, as of the 2014 Zhuhai Airshow, the first flight has been delayed to 2015, with the first delivery delayed to 2018.

At the 2015 Paris Air Show, Ping An Leasing signed a letter of intent for 50 C919s. This deals makes the Shanghai-based Chinese lessor one of Comac's largest customers. In addition to Ping An Leasing, Puren Group also signed a letters of intent for seven C919s and seven ARJ21s, intended for the start-up Puren Airlines. Also during that time Nepal Airlines and Air India was interested in acquiring 2–3 to replace older aircraft.

PLANE ORDERS

Aircraft of comparable role, configuration and era

Airbus A320neo family
Boeing 737 MAX
Bombardier CSeries
Irkut MS-21 series
Kawasaki YPX