The Nanfang / Blog

China Southern upgrades GZ-Sydney to superjumbo on cheap Canton Route

Posted: 05/6/2013 8:53 am

China Southern Airlines’ (CSA) flagship A380 superjumbo is set to land in Sydney later this October underlining Australia’s importance as a key tourism and trading partner to Beijing.

Starting October 27, flight CZ325/326 will shuttle passengers between Guangzhou and Sydney, boosting the ‘Canton Route’ as the cheapest way to fly between the Australia and Europe.

With 41 per cent more capacity, according to CAPA data, it will increase the number of cheap tickets, especially at the front and top of the plane: there will be 52 more business class seats and four more in first class to fill.

Travelers won’t be able to fly all the way to London on the A380, however. Qantas, Emirates and Singapore Airlines are the only full-service carriers to fly all the way with the superjumbo.

CSA plans to put Boeing’s troubled Dreamliner on its European destinations – Amsterdam, London, Moscow and Paris – as soon as the first of 10 deliveries arrive.

Travelers en-route to Australia and Europe will be able to take advantage of Guangzhou’s soon-to-be implemented 72-hour visa free policy, potentially boosting Guangdong’s image to tourists.

People are packing their bags for Down Under in droves. Some 386,000 passengers flew with CSA in 2012, 56 per cent more than in 2011, according to Xinhua.

China’s biggest airline is proving a popular choice with the best connections to Australia.

The Guangzhou-based airline already flies twice-a-day to Sydney, and 30 return flights a week to Australia from its Baiyun hub, doubling the number of services operated three years-ago.

CSA has ambitious plans to operate 55 weekly return flights to Australia and New Zealand by 2015.

The combined popularity of Asia’s largest airline and the allure of Australia means that all services Down Under are turning a profit.  It’s a rare bright spot, with most international routes deep in the red as a result of aggressive expansion.

Outside of China, the A380 only flies to Los Angeles. Regulatory hold-ups have restricted the majority of the five planes worth US$389 million each to Beijing, Guangzhou, Hong Kong and Shanghai.

The latest earnings by CSA show an 82 per cent slump in first quarter net profit to RMB57 million (US$9.1 million).

Photos by Danny Lee and Noel Jones


Airline revenue crashing due to high-speed rail competition in China

Posted: 02/20/2013 3:55 pm

China’s major airlines are spilling red ink everywhere.

The SCMP is reporting that mainland carriers have amassed RMB1 billion (US$160 million) in losses in the last three months, with pressure coming from China’s ever-expanding high-speed rail network.

Those suffering include Guangzhou-based China Southern Airlines, the biggest of the major domestic carriers, whose revenue per kilometer – a measurement of the available seats sold – fell 1 per cent year-on-year. By comparison, Air China shed 1.5 per cent and China Eastern slumped 2 per cent.

But those statistics don’t really tell the story of last year.

China Southern, which is ramping up capacity with the introduction of five Airbus A380s, is putting more resources into its long-haul operations. The newly appointed ‘Canton Route’ is part of the new international focus. At the same time, it is having to contend with soaring jet-fuel prices.

Here is a significant line from the general manager Tan Wangeng carried in CAPA revealing the extent of today’s problems:

All of the carrier’s 30 weekly services from Guangzhou to Australia and New Zealand are profitable, the result of the carrier’s strategic transformation into an international network carrier (Xinhua, 06-Feb-2013). According to Mr Tan, the majority of Chinese carrier’s international routes are making losses.

With high-speed rail supercharging national connectivity, it’s going some way to put downward pressure on airfares, placing it at odds with the state-backed carriers.

Here’s what MF Global’s greater China transport analyst Geoffrey Cheng told SCMP’s Charlotte So:

“The diversion to high-speed trains has become more and more serious as the memory of the high-speed-train tragedy in Wenzhou in 2011 fades out.”

The situation has been made worse by airlines boosting capacity in expectation of a brisk Chinese New Year. Now, rock-bottom prices are in the system to try and fill seats.

While lagging, aviation analysts CAPA say growth will more than make up for short-term sluggishness. They says airlines can absorb a 3 per cent capacity cut in 2013.

If the 3% drop in capacity is entirely correlated to HSR, the one-year drop would be made up for in coming years with higher growth.

With the Chinese government tightly controlling aircraft imports, demand generally exceeds supply, which would allow any excess capacity on a route to be re-deployed.

CAPA has also conducted more of a detailed analysis on the impact of high-speed rail in China.

HSR holds an advantage over air travel on sectors under 800km. Between 800-1200km there could be a tradeoff depending on factors including how direct the train tracks are and what the fare difference is. Above 1200km air travel will almost always hold an advantage.

Seems pretty straight forward.

China Southern’s biggest high-speed rail threats are from Guangzhou to Wuhan (1020 km) and Beijing (2170km).

Image: Danny Lee


Guangzhou getting a new airport, India’s SpiceJet starts service to the PRD

Posted: 08/4/2012 11:00 am

A lot can happen in a week, and in the latest PRD aviation round-up of the thriving sector, The Nanfang gives you new and expanding airports, bigger planes and new destinations.

Baiyun Airport gets bigger, so will the number of Guangzhou’s airports
In the latest gathering of Guangzhou’s political decision-makers, the Standing Committee approved plans to construct a third runway at Baiyun Airport with construction starting this month. In other news, construction will begin on the airport’s new second terminal – just north of the existing facility – by the end of the year.

However, if that isn’t enough, China Daily reports that the airport extension is in line with current plans to create a second Guangzhou airport to the south of the city. If plans come to fruition, the PRD will become one of the most congested regional airspaces in the country catering for Guangzhou, Hong Kong, Zhuhai, Shenzhen and Macau.

China Southern’s first A380 international flight
There was a lot of hype, fanfare and attention on China Southern Airlines (CSA) newest arrival, the double-decker A380, last year. Then it headed into a year-long domestic exile. Now though, it’s going international: It’s off to Hollywood.

The carrier’s upgraded service will take off on October 12 as the first and only Chinese superjumbo to head across the Pacific.

While China Southern already flies to Los Angeles, it believes it can tap into a greater share of the Trans-Pacific market. In doing so, Airline Route reckons overall capacity will soar 78 per cent, meaning CSA has its work cut out for itself.

CSA has three superjumbos in its fleet with two more on the way, which will be deployed on international routes and primary domestic cities.

India’s SpiceJet heads to the PRD’s busiest airports
India’s budget airline SpiceJet has won government approval to expand international operations, starting with daily services to Hong Kong and Guangzhou. The Nanfang earlier reported on India’s aviation reforms aimed at revitalising the sector.

As SpiceJet plans for a China arrival, Dragonair prepares for a second Indian landing
Dragonair is extending its reach away from the Far East and South East Asia. Starting November 2, a new four-times-a-week service to Kolkata, in the eastern state of West Bengal, will take off. The move will also help support Cathay Pacific, its parent company, as a feeder and codeshare airline. Cathay already flies to five major Indian cities.

And two major updates on stories The Nanfang trailed last week on Shenzhen-Sydney, Delhi-Hong Kong-Osaka Kansai and Delhi-Hong Kong-Seoul Incheon. Air India is resuming flights to Seoul Incheon and Osaka Kansai via Hong Kong earlier than planned. The Delhi-Hong Kong-Osaka Kansai route resumes with three weekly flights starting on August 21 and Delhi-Hong Kong-Seoul Incheon resumes the following day with four flights a week.

Hainan Airlines has postponed resuming its Sydney service until December 3.


More flights to Amsterdam, Osaka and Vancouver from Guangzhou

Posted: 04/16/2012 8:03 am

China Southern Airlines (CSA) international flights are set to increase this summer after the company announced its new schedule for the upcoming season. Japan is the main beneficiary, as the Guangzhou-based carrier will double its Baiyun Airport flights to Osaka to fourteen a week.

Amsterdam will receive an extra two flights per week, bringing its total to seven per week from June 13. And, as reported a few weeks ago, London will receive three direct flights a week from Guangzhou, beginning June 2, just in time for the Olympics. Overall, the new schedule brings the number of European destinations served by Guangzhou to twenty-eight flights a week.

In North America, Vancouver will be served by five flights a week, up on the existing three slated to take-off from Baiyun Airport from June 23. Travelers will also benefit from a new relationship with WestJet, enabling CSA passengers to transit and fly onwards to Toronto, Montreal and another twenty-nine Canadian cities.

In other news, the worst of the political instability in the Maldives is over, according to CSA, which paves the way for twice-weekly flights from Guangzhou to resume to the capital, Male, from April 22.

With CSA’s announcements of new routes and increased frequencies, its international capacity will increase to 27.2 per cent, and that figure is set to increase to 30 per cent by year end, according to Life of Guangzhou.

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