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Old December 13th, 2005, 12:37 AM   #601
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Zen and the art of air transport
Mainland airlines still have a way to go to catch up on global service standards, but passengers are being patient
13 December 2005
South China Morning Post

THE GROWTH OF flight networks in China is giving frequent travellers greater flexibility in crisscrossing the country, but does this also mean better service? The service and security performances of major mainland airlines have been improving over the past few years, but customer satisfaction is still mixed at best.

"I have flown to Shanghai and Guangzhou with China Eastern and China Southern," said John McHugh, chairman of the Canada China Business Council in Beijing. "Food in business class was nothing special. There was no individual TV programme, and in the business-class lounge, well, you had some coffee and beer. The one real advantage of the business class is you have more space. But it's okay. The bottom line is, it's just about transport."

Air transport is booming, along with the rest of China's economy. Over the next 20 years, passenger air travel in the mainland is expected to grow at the rate of 7 to 8 per cent annually, about 1½ times higher than the expected global growth average.

China is the main destination for business travelling in the region, and Hong Kong executives are among the busiest travellers in this part of the world. Yet, because of the relatively short distances between China's business centres, most executives travel economy class.

"Only about 5 per cent of my corporate customers travel on business class," said Janet Hom of Plan Travel in Hong Kong.

Dragonair is clearly the airline of choice for business trips to the mainland from Hong Kong. "Most of my customers travel Dragonair," said Ms Hom. "Not just for the superior service. They also feel safer."

Dragonair was named China's best airline for the past four years by Skytrax, the world's largest annual air passenger survey. The carrier scored four stars out of a maximum five in Skytrax, while the three major carriers from the mainland - Air China, China Eastern and China Southern - scored three stars, signifying a satisfactory standard across most travel categories but possibly reflecting less consistent standards of staff service and product delivery.

Earlier this year, the Civil Aviation Administration of China (CAAC) gave the nod to a handful of private airlines, which promise greater consumer choices. However, these new airlines' operations are restricted to less travelled, less lucrative routes. Busy routes between Shanghai, Beijing and Guangzhou are still in the hands of a group of state-owned carriers.

In spite of a generally positive trend, things can still go wrong. One passenger complained of chaotic check-in, poor food, bad wine and careless service.

"Sometimes you just need to have a bit of a Zen attitude," said Dominique Perregaux, owner of the Art Statements Gallery in Central and former investment-banker with Credit Lyonnais Securities Asia.

"Otherwise, you might get quite stressed out."
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Old December 16th, 2005, 07:46 PM   #602
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HK-listed China Eastern Airlines Nov passenger traffic up 76.54 pct yr-on-yr
16 December 2005
Xinhua Financial Network (XFN)

BEIJING (XFN-ASIA) - China Eastern Airlines Corp Ltd said it carried 2.49 mln passengers in November, up 76.54 pct year-on-year.

In a statement, the Shanghai-based carrier said passenger traffic for the first 11 months rose 33.96 pct from a year earlier to 22.05 mln.

Cargo throughput rose 35.07 pct from the same period of last year to 76,860 tons for November and was up 12.11 pct at 681,130 tons for the first 11 months.
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Old December 19th, 2005, 04:44 AM   #603
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China Southern Hldrs OK Purchase Of Boeing, Airbus Planes
18 December 2005
Dow Jones

China's air travel industry is booming as more middle-class people take to the skies. Both Airbus and Boeing have predicted that within 20 years, China will become the world's No. 2 market for jetliners, after the U.S.

Guangzhou-based China Southern Airlines is one of the country's three major airlines, along with Air China Ltd. (0753.HK) and China Eastern Airlines Corp. (CEA).
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Old December 20th, 2005, 06:23 PM   #604
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China to open direct air route to Brazil next month
19 December 2005
Xinhua's China Economic Information Service

BEIJING, December 19 (CEIS) -- China will open the country's first direct air route to South America, from Beijing to Sao Paulo of Brazil, next month.

The route will be operated through code-sharing cooperation by Air China and Varig, Brazilian's national carrier. Air China will fly from Beijing to Frankfurt, while Varig will fly from Frankfurt to Sao Paulo, the largest city in Brazil.

The time of travel from Beijing to Sao Paulo will be 27 hours, including transferring. The route has been approved by Chinese and Brazilian governments and is still waiting for approval from Germany, said Cesar Yu, China's country manager of Varig.

He said China and Brazil are developing nations, with economic and trade cooperation much closer in recent years. Brazil also became the tourist destination nation for China. The new route will promote economic, cultural, tourist and sports exchanges between the two nations.
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Old December 22nd, 2005, 06:15 AM   #605
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China Southern confirms 134 mln usd upgrade plan, new Beijing air terminal
21 December 2005

BEIJING (AFX) - China Southern Airlines, the country's largest airline, said it will spend more than 134 mln usd upgrading its operations, including a new international terminal at the Beijing Capital Airport.

The airline said in a statement that it plans to use this new terminal to base its recently-ordered Airbus A380 aircraft and Boeing 787 Dreamliners, scheduled for delivery in late 2007.

'The foundation of the (new Beijing operations) is crucial for China Southern's sustained development,' said Liu Shaoyong, chairman of China Southern Airlines.

China Southern Airlines currently operates its own terminal at the Beijing Capital Airport.

Liu said that he hopes the upgraded Beijing operations will tap potential business related to the 2008 OIympic Games in Beijing as well as booming air travel from the capital.

International passengers passing through Beijing last year totaled about 10 mln, topping all other airports in China, the statement said.
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Old December 22nd, 2005, 06:42 PM   #606
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United Airlines to expand transport capacity between Beijing and Chicago
20 December 2005
Xinhua's China Economic Information Service

SHANGHAI, December 20 (CEIS) – United Airlines of the United States will expand the transport capacity of the Beijing-Chicago air line from early April 2006.

Boeing 747 luxury planes with more seats will take the place of Boeing 777 planes to serve in the air line.

United Airlines, the second largest airline company of the United States, now is the largest air carrier between China and the United States. As the first airline to provide no-stop direct flight service between the two countries, it now boasts the largest number of direct flights to Beijing and Shanghai.
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Old December 29th, 2005, 09:32 AM   #607
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China To Open Air Sector More, Up Invest In 06 - Xinhua
27 December 2005

BEIJING (Dow Jones)--China will continue to open up the domestic aviation sector as part of efforts to attract more investment in 2006, the official Xinhua News Agency reported Tuesday, citing the country's aviation regulator.

China will raise the number of airlines and the frequency of flights across the country to meet rising demand next year, said Yang Yuanyuan, director of the General Administration of Civil Aviation of China, according to the report.

China will encourage new companies to focus on freight transport and branch airlines, Yang said. The report didn't clarify whether Yang was referring to regional airlines.

Yang also said some airports in western China, including those in the cities of Chengdu, Xian and Urumchi, would be upgraded and turned into regional aviation hubs next year.

The government's stance signals China will let more Sino-foreign joint ventures, as well as local private companies, into the aviation sector, Xinhua said, citing sources at a national aviation conference where Yang spoke.

The report didn't say what the regulator would do to promote investment in the aviation industry.

Monday, China's aviation regulator said China's total air traffic will grow 13% in 2006 to 29.5 billion freight ton-kilometers, according to a statement on its Web site. One ton-kilometer is one ton of freight transported one kilometer.

The number of passengers will rise 15% next year to 159 million, the statement also said.

For the first 11 months of 2005, China's air traffic totaled 23.7 billion freight ton-kilometers, up 11.4% from the same period last year, while the number of passengers rose 12.7% to 126.76 million, the statement said.

In the January-November period, China's aviation sector posted profit of CNY5.82 billion, the statement said, without specifying whether it was referring to operating, pretax or net profit.

China's aviation sector logged a profit of CNY8.69 billion in 2004, the Beijing Morning Post reported earlier in the year, citing the regulator.
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Old January 2nd, 2006, 04:14 AM   #608
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Pudong to double capacity by 2015 as throughput soars
Shanghai plans to expand two terminals after traveller volume rises 15pc to 41m
2 January 2006
South China Morning Post

Passenger volume at Shanghai's two airports last year grew by more than 15 per cent and the bigger of the two will more than double existing capacity by 2015, the Shanghai Airport Authority (SAA) announced at the weekend.

Officials at the airport authority told a news conference that Pudong and Hongqiao airports handled 41.4 million passengers last year, an increase of 15.3 per cent over 2004 and 2.2 million tonnes of air freight, up 13.9 per cent.

Built in 1999 on the shore of the East China Sea, Pudong International Airport is the larger of the two, handling 23.6 million passengers last year, up from 21 million, and 1.85 million tonnes of freight, up from 1.6 million.

The officials said that Pudong ranked ninth or 10th among the world's 1,450 airports last year in terms of freight volume, up from 13th in 2004.

The airport's rapid growth is a major challenge to Hong Kong, Inchon in South Korea, Singapore and other Asian airports that are competing fiercely for passengers and freight to be the region's main hub.

"The city's two airports have been overburdened in meeting the rapidly growing demand in passengers and cargo," said Wu Nianzu, SAA chairman.

"We will adjust the facilities at both to meet demand."

For this year, the officials forecast a 13 per cent increase in both passengers and freight.

A total of 65 airlines fly in and out of Shanghai with eight added last year and the city is linked to 181 destinations.

Pudong is the second-largest mainland airport after Capital Airport in Beijing, which handled 40.7 million passengers last year.

The SAA has ambitious plans to transform Pudong into one of the biggest travel hubs in the Asia-Pacific region, with 30 per cent to 40 per cent of passengers transferring to other flights, up from 5 per cent now. It currently has one terminal and two runways.

On December 16, the SAA announced plans to double passenger and cargo volume by 2015 with construction of a second terminal with a 480,000 square metre floor area compared with 278,000 sqm for the existing terminal and three new runways.

Preparatory work is under way on the site, chosen on empty land next to the ocean to allow for easy expansion.

Longer-term plans call for construction of two more terminals with a target of 60 million passengers and 4.2 million tonnes of cargo in 2015.

Passengers complain about the long distance from the city centre to Pudong airport, which takes about an hour by bus or taxi.

The alternative is a Mag-Lev (magnetic levitation) express train - it takes seven minutes to reach a suburban station on the city's No2 subway line, leaving travellers with a further journey.

The failure to build a rail line from the airport into the city centre, as in Hong Kong, was a major design mistake.

The city government says it will extend the No2 subway line to Pudong airport by 2010.
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Old January 2nd, 2006, 08:12 AM   #609
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Shanghai Airlines to Increase Fleet by 57 Planes

SHANGHAI, Jan 2 Asia Pulse - Shanghai Airlines Co. Ltd will add 57 more planes to its current fleet in the forth coming five years, according to Zhou Chi, chairman of the board with the air carrier.

Founded on Dec. 30, 1985, Shanghai Airlines Co. Ltd., China's first licensed local air company, began its air service with five second-hand Boeing 707 planes. It now has 43 planes and is operating 150 air routes, including 10 international ones.

"Our company will see a faster growth in both passenger and cargo transport with new opportunities created by Shanghai's drive to build into an air service center from 2006 to 2010," said Zhou.

He disclosed that the air carrier would also diversify its scope of business by expanding into logistics, tourism and hotel industry during the same period.

(XIC)
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Old January 8th, 2006, 04:16 AM   #610
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China to make building large aircraft a priority

BEIJING, Jan 6 (AFP) - China intends to make the manufacturing of large commercial airplanes a top priority from 2010, the nation's defense industry announced Friday.

The Commission of Science, Technology and Industry for Defense (COSTIND), which is responsible China's defense technology, said the aerospace industry will focus on the issue during the five-year period beginning 2010.

"The priority for the airline industry (during the period) will be on trunk liners, with research and production to begin at the appropriate time," a press release on the COSTIND website said after its chiefs met this week.

COSTIND also has a strong influence over civilian industries that contribute to the nation's defense.

No other details were provided on the type of airliner being considered or specific timing.

China has long considered building a large 150-200 seat commercial aircraft, rather than continuing to rely on Boeing of the United States and Europe's Airbus.

Industry officials last year urged the central government to approve the building of such planes before the country's demand for them peaked over the next two decades.

"If China does not roll out its own trunk-liner by 2020, then the country will not succeed in 2030 or 2040 so it is really a rush," Liu Daxiang, a senior official with the state-owned China Aviation Industry Corporation I, said last June.

With 120 million people traveling by air in 2004, China is now the third biggest aviation market in the world after the United States and Europe.

The 150-200 seat aircraft fits China's economic and geographic criteria, previous state press reports have said.

Such aircraft would be ideal to fly between each of the key economic powerhouses -- the Bohai region in the northeast, the Yangtze Delta surrounding Shanghai in the east and the Pearl River Delta, home to Guangzhou and Hong Kong -- which are more than 1,000 kilometers (625 miles) apart, the reports said.
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Old January 9th, 2006, 05:31 PM   #611
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China's Top Airlines Eye Cheaper Jet Fuel Imports -Report
8 January 2006

BEIJING (Dow Jones)--China's top three airlines plan to appeal to the government to eliminate the tariff on jet fuel imports in a bid to reduce their operating costs, the 21st Century Herald reported Sunday.

Air China Ltd. (0753.HK), China Eastern Airlines Corp. (CEA) and China Southern Airlines Co. (ZNH) are drafting a request to submit to the State Council, China's cabinet, the report said.

The airlines will also ask for a reduction in the value-added tax for jet fuel imports and sales, said the report.

China's jet fuel import tariff is currently 9% and the value-added tax for jet fuel imports and sales is 17%, according to the report.

China's airlines are suffering from soaring fuel prices and high tariffs.

Domestic jet fuel prices rose 25% in 2005, pushing the three airlines' costs up by CNY7 billion ($875 million), said the report.

Jet fuel costs currently account for 40% of airlines' overall costs from 25% in 2004, according to the report.

The General Administration of Civil Aviation of China raised the government-set jet fuel price from CNY4,824/ton to CNY5,133/ton Dec. 31, said the report.

The carriers will also 'urge the government to reform the jet fuel supply mechanism and demand jet fuel import rights of their own,' said the report.

Currently, airlines buy jet fuel mainly from state-owned China Aviation Oil Holding Co. at a price set by the government, the report said.
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Old January 9th, 2006, 05:32 PM   #612
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S. China Province opens eight international air routes in 2005
9 January 2006
Xinhua's China Economic Information Service

HAIKOU, January 9 (CEIS) -- China's southernmost Hainan Province increased eight international air routes in the past year, the provincial government sources said here on January 8.

The eight international air routes are opened by seven foreign airline companies including Asiana Airlines and Malaysia Airlines, making the international air routes of the province rising to 51.

Statistics from the provincial government show that Hainan saw 3, 479 international flights during the first 11 months last year, 31.60 percent more than the same period in 2004.

As China's first province to open up part of the aviation rights to overseas airlines, Hainan has attracted 14 foreign air companies since July 2003, opening 28 international air routes linking the island province with the world.
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Old January 9th, 2006, 05:34 PM   #613
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N. China city opens five int'l air routes
9 January 2006
Xinhua's China Economic Information Service

TAIYUAN, January 9 (CEIS) --- People in North China's Shanxi Province will travel more easily to foreign destinations as five international air routes were opened here on January 6.

With an airliner leaving the provincial capital of Taiyuan on January 6 for Frankfurt in Germany, Shanxi was for the first time linked with foreign countries by air routes.

The five routes, operated by Beijing-based Air China, link Taiyuan with Frankfurt, Paris, London, New York and San Francisco with a brief stop in Beijing.

Shanxi is China's major coal production base and a popular tourist destination, boasting two sites that are included in UNESCO World Heritage list.
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Old January 10th, 2006, 03:49 AM   #614
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China's budget carrier Lucky Air to launch maiden flight before end of month
9 January 2006

BEIJING (AFX) - Hainan Airlines (SHA 600221; SHB 900945), in which US-financier George Soros holds an indirect stake, said its subsidiary Lucky Air Co Ltd is expected to launch its maiden flight before the end of January.

In a report on its website, Hainan Airlines cited Lucky Air chief executive Ma Guohua as saying the newly formed carrier will become 'a real budget carrier operating regional routes at low cost'.

China's fourth-largest airline Hainan Airlines owns a 67.95 pct stake in Lucky Air, which is based in Dali Airport in the southern province of Yunnan.

George Soros holds an indirect stake in Hainan Air through his investment vehicle American Aviation.

Lucky Air has received approval to lease three B737s from Hainan Airlines' unit Shanxi Airlines for its operations.
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Old January 10th, 2006, 11:46 PM   #615
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Air China December Passengers Up 19% On Year, Cargo +17%
10 January 2006

HONG KONG (Dow Jones)--China's flag carrier Air China Ltd. (0753.HK) said Tuesday it carried 19% more passengers in December than in the same month a year earlier, accelerating from a 14% rise in the previous month.

The Beijing-based airline said it transported 2.2 million passengers in December, with domestic traffic accounting for 81% of the total. Its cargo traffic rose 17% to 69,832 tons.

For the year as a whole, Air China carried 13% more passengers to 27.7 million, from 24.5 million in all of 2004. The airline also shipped 10% more cargo to 732,817 tons, from 665,252 tons.

The airline's passenger load factor, a measure of how much of its available seats were filled, rose to 69.7% in December, from 67.5% in the same month in 2004.
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Old January 12th, 2006, 04:56 AM   #616
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Danish union against SAS using Chinese staff cheap

COPENHAGEN, Jan 11 (Reuters) - A Danish union is threatening Scandinavian airline SAS with a strike unless it drops plans to employ Chinese cabin crew on routes to China with much lower pay and conditions than it offers its current staff.

Cabin Union Denmark (CUD) fears that the recruitment by SAS of 35 Chinese flight attendants could prompt the cost-cutting airline to hire staff for lower wages on other routes as well.

"Since spring 2005, we have repeatedly told SAS this is unacceptable and they are in an extreme risk of a strike if they do this," Verner Lundtoft Jensen, head of the CUD, told Reuters.

The union says it is not against SAS employing Chinese workers but wants to ensure they are included in union agreements and do not undercut current staff.

Hiring Chinese cabin staff, including uniforms, hotels and education, costs SAS around 10,000 Danish crowns ($1,618) per person per month, a fifth of what the airline would have to pay for a Dane, the CUD said.

"Here we have a state owned company like SAS and they are importing workers from China. That is OK, but they have to accept that they have to work under the Danish collective agreement", Lundtoft Jensen said.

The Swedish government owns 21.4 percent of SAS shares and Denmark and Norway hold 14.3 percent each.

CUD has taken the case to a lower arbitration court. Proceedings will begin in January.

If a deal is not reached by March 1, when the CUD is due to renegotiate its collective agreement with SAS, it may strike.

"A strike could come very soon after that. But we hope it will not go that far," he said.

SAS has been hard hit by competition from low-cost airlines and higher fuel costs, although it has forecast a return to profit in 2005 after four years of losses.

It has pushed through a 14 billion Swedish crown package of cost cuts and plans to trim expenses by another 2 billion in 2006-2007 through productivity gains, particularly among pilots and cabin staff, and by simplifying its business model and sales methods.

SAS declined to comment on the salary levels for Chinese staff but spokesman Jens Langergaard said he thought they were "very good by Chinese standards".

The airline hired the Chinese staff because "our customers have requested mandarin-speaking cabin attendants. We have recruited them locally and they will be paid according to local agreements," Langergaard said.

The Chinese employees are currently in Denmark for training.

SAS already has local cabin crew in Japan and Thailand, with the agreement of the union.
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Old January 16th, 2006, 06:17 AM   #617
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HAECO eyes Baiyun facility

Hong Kong Aircraft Engineering Co, the maintenance company controlled by Swire Pacific and Cathay Pacific, is in talks to open a new aircraft maintenance center at Guangzhou's gleaming Baiyun International Airport, a source close to the airport said.

Alman Loong
Hong Kong Standard
Monday, January 16, 2006

Hong Kong Aircraft Engineering Co, the maintenance company controlled by Swire Pacific and Cathay Pacific, is in talks to open a new aircraft maintenance center at Guangzhou's gleaming Baiyun International Airport, a source close to the airport said.

With the mainland's rapidly expanding aviation market attracting growing investment in the highly competitive jet maintenance sector, HAECO managing director Chan Ping- kit visited Baiyun last week for negotiations with the airport management about the plan, the source said.

But he stopped short of confirming the new center will become a reality.

"I visited Baiyun Airport and there is a lot of business opportunity," Chan said, adding that the company has not made a final decision.

The center will be HAECO's second mainland maintenance facility.

It owns 55 percent of Taikoo (Xiamen) Aircraft Engineering Co, which opened in Xiamen in 1996.

The new project should have a major client when Federal Express, the US courier and logistics company, moves its Asia Pacific hub to Baiyun from the Philippines in 2008, replacing its existing hub.

TAECO chief operation officer John Chi said last month that HAECO would set up a second maintenance center in southern China and has already signed a letter of intent.

Chan indicated that the company was not yet ready to reveal its plans.

"We hope to finish the expansion plan in TAECO and then make a decision [on the new facility] before the end of the year," he said.

TAECO plans to open a sixth hangar to handle a growing volume of business, which mainly involves maintenance and modification of Boeing 747, 757 and 737 aircraft.

China's domestic airlines are rapidly expanding their fleets to meet a surge in demand that will make the mainland the world's second-largest aviation market after the United States within the next two decades, according to an Airbus forecast.

As a result, the mainland's maintenance, repair and overhaul market is expected to be worth US$2.5 billion (HK$19.5 billion) by 2014, AeroStrategy Management Consulting estimates.

Three mainland airlines are already in partnerships with foreign investors to capture the business. One such partnership is Guangzhou Aircraft Maintenance Engineering Co.

Based near Baiyun Airport, Gameco is a joint venture between Hutchison Whampoa and China Southern Airlines, and is one of the mainland's leading heavy aircraft maintenance companies, providing repair and servicing for more than 240 flights a day at the airport.

Gameco has invested more than 900 million yuan (HK$866.16 million) to build a four-bay widebody hangar, including a paint shop at Baiyun Airport.

The other major player is Aircraft Maintenance & Engineering Corp, co- owned by Deutsche Lufthansa and Air China.
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Old January 17th, 2006, 04:19 AM   #618
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SAS To Meet Unions For Talks On Chinese Staff Tuesday
16 January 2006

STOCKHOLM (Dow Jones)--SAS Scandinavian Airlines Denmark, the Danish unit of SAS AB (SAS.SK), will meet with the Danish cabin crew union CAU Tuesday to discuss a complaint from the union regarding the employment of 35 Chinese cabin crew, it said Monday.

The union's complaint regards the employment by SAS of Chinese staff outside of a collective agreement comparable with the Danish one.

CAU's head of cabin personnel, Verner Lundtoft Jensen, said that if the Chinese employees are accepted without an agreement, there would be a situation in the longterm where staff under collective agreements risk losing their jobs to those without them.

"We think this is just the beginning," he said.

He added that if an agreement can't be reached with SAS Tuesday the union will try to get the case tested in the Danish courts.

Jens Langergaard, press officer of SAS Scandinavian Airlines Denmark, said the Chinese cabin crew's work will be based in Shanghai, hence it is the airline's opinion they should be hired according to Chinese regulations.

He added that this is the way the company has worked with employees from several other countries.
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Old January 18th, 2006, 12:45 AM   #619
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Lufthansa sees more China flights - paper

FRANKFURT, Jan 16 (Reuters) - Deutsche Lufthansa wants to accelerate its growth in China this year, its chief executive told Germany's Handelsblatt newspaper.

In the future, the airline expects 52 direct flights to Shanghai, Beijing, Hong Kong and Guangzhou, CEO Wolfgang Mayrhuber told the newspaper.

In 2005, the newspaper said, the airline offered 43 connections between Germany and China.

The number of China passengers should increase by about a quarter this year, up from an increase of 18 percent in 2005.

"China is an extremely important market for us," Mayrhuber said.
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Old January 19th, 2006, 06:02 AM   #620
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China Eastern sees 2005 profit down 50-plus pct

SHANGHAI, Jan 19 (Reuters) - China Eastern Airlines Corp. Ltd., one of China's top three airlines, said on Thursday it expects its net profit for 2005 to be down more than 50 percent from 2004, amid high fuel costs.

China Eastern previously reported a net loss of 471.4 million yuan ($58 million) in the first half of the year, but swung back to a 673.2 million yuan profit in the third quarter.

But it said November and December were slow months for the airline due to seasonal patterns, according to an announcement in the official Shanghai Securities News.

It also blamed high oil prices for the expected big decline in profit.
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