Chinese Economic Growth Stimulates Chinese Airline Growth
Some of the world’s largest airlines are now based in developing nations. Air China has twice the market capitalization of either U.S. airline Delta or Germany’s Lufthansa. Beijing Capital overtook Britain’s Heathrow to become the world’s second busiest airport, and is now second only to America’s Hartsfield International airport in Atlanta, Georgia. Chinese airport construction and expansion is expected to increase, and China is now producing commercial airplanes in competition with Boeing and Airbus.
Economic development and the emerging Chinese middle class have spurred demand for domestic air travel in mainland China, as well as international connections between China and Asia, as well as China and the rest of the world.
Use of Air Transport in Modern China
Travel by bus and common (i.e., not high-speed) passenger train were the primary methods for travel among cities within China up through the 1990s, but since then domestic air travel has become a viable, price-competitive, commonly-chosen means of transportation for a growing portion of the Chinese population.
The State of Chinese Airlines
Most large Chinese airlines are state-owned or state-backed, although efforts have been made to make these airlines nominally private or semi-private through listings on domestic and international stock markets. While competition does exist between airlines, the Chinese government plays a significant role in the formation, regulation, and consolidation of Chinese airlines. For example, a 1 yuan promotional ticket price offered by China’s budget carrier Spring Airlines did not sit well with Chinese government officials, and was canceled not long after its introduction.
Chinese airlines have undergone and will continue to undergo rounds of consolidation, where domestic, often regional airlines are purchased by other, larger players in the Chinese airline industry. China has a few strong airlines (China Southern, Air China, and China Eastern) which occupy a significant position in both the Chinese domestic and international market.
Major Chinese Airlines
Below is information about the major players in the Chinese airline industry.
China Southern Airlines
Pinyin: Zhongguo Nanfang Hangkong
IATA Airline Code: CZ
Overview: Based in the southern Chinese city of Guangzhou, China Southern in China’s largest airline. China Southern’s website notes that “In 2009, China Southern Airlines carried 66.28 million passengers and is the 3rd largest airline in the world and 1st in Asia.”
China Eastern Airlines
Pinyin: Zhongguo Dongfang Hangkong
IATA Airline Code: MU
Overview: Based in Shanghai, China Eastern is the second largest carrier in China in terms of passenger numbers.
Pinyin: Zhongguo Guoji Hangkong Gongsi
IATA Airline Code: CA
Overview: Based in Beijing, Air China is the national flag carrier for the People’s Republic of China, and is the airline Chinese state leaders use when travelling abroad on official business.
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Sources: Atlanta Journal-Constitution, MarketWatch, Aviation Week