Chinese airports are not only shifting gears, but also stepping on the accelerator to drive international traffic and expand their networks, after decades of relying on domestic traffic for growth.
While large tier-one airports such as Beijing Capital International airport are working to restructure their networks and cater for more international flights amid slot constraints, smaller gateways such as those in Chongqing and Haikou are going all out to woo airlines for new international launches.
Last year, Chinese airports handled a combined 914.8 million passengers, up 10% from 2014. While the number of domestic passengers rose 9%, international passenger numbers saw a 21.1% jump, data from the Civil Aviation Administration of China shows.
SCRAMBLING FOR THE WORLD
Beijing airport tells Flightglobal it is no longer chasing growth in passenger numbers, but placing a priority on expanding its international network.
The airport - which grew 4.4% in lifting passengers to just shy of 90 million - is already the second biggest airport in the world behind Atlanta. Around a quarter of its traffic is international. The goal is to have 30-40% of traffic come from outside China, with an aim to build it into a reputable international hub.
“In the whole of China, if Beijing is not the international hub, where else should it be?” said its former president Shi Boli, adding that the Chinese capital is geographically ideal to connect southeast Asia to Europe and the United States. It is also targeting to improve connections to central America and Africa.
Like many of its peers, the airport is working with home airlines to add international destinations, and also to facilitate transits and shorten connection times to make long-haul travel more convenient and comfortable for passengers.
This comes at a time when not just the big four carriers – Air China, China Southern Airlines, China Eastern Airlines and Hainan Airlines – but even smaller operators are setting their sights on high yield opportunities in the international market. This is driven by fierce competition in the domestic market, as well as the growing desire among locals, with their growing disposable incomes, to travel abroad.
Over the last year, at least five domestic airlines - the likes of China United Airlines and West Air - have also applied to expand their business scope beyond domestic operations.
FAR-FLUNG AMBITIONS
Growth has been strong in second tier cities too. Chengdu Shuangliu International airport has seen rapid growth in its international traffic in recent years. In the first eight months of the year, while overall passenger numbers climbed 15%, international traffic shot up more than 30%.
The airport, which has 83 international routes, is working to grow its connections to Europe, North America and Africa. The aim is to become the largest airport in central and western China, says Sichuan Province Airport Group board chairman Li Wei.
He adds that the city will also open a second airport in 2019, becoming the third Chinese city after Shanghai and Beijing to have two commercial airports. Plans call for the new terminal to handle more international traffic.
Joanna Lu, head of advisory Asia with Flightglobal’s Ascend Consultancy says that more secondary Chinese airports want international routes, not just within Asia, but to longer-haul markets.
“In the past the local market of a Chinese secondary airport was often just not substantial enough to support a new long-haul route,” she says. “The situation has however changed significantly because these airports have improved the connection to the China domestic market.”
In 2015, there were 26 Chinese airports which handled more than 10 million passengers, two more than the year before, CAAC data shows. Those that saw more than one million passengers numbered 70, six more than in 2014.
HUB CLUB
Shenzhen Bao’an International airport, for one, is working to drive more international traffic, and to transform itself into a hub airport.
In 2015, the airport handled 39.7 million passengers, 9.5% higher than the year before. International traffic, however, accounted for less than 5% of the total figure. Its deputy general manager Sun Zhengling says the airport’s air traffic development has not kept pace with the growth of the city, which is strong economically and focused on the high-tech industry. The majority of its passengers are business travellers, and the city’s dwellers are seeing their incomes grow, increasing their ability to travel, he adds.
Shenzhen faces stiff competition from neighbouring hubs such as Hong Kong International airport and Guangzhou Baiyun International airport. Sun says the airport can play a bigger role considering the congestion at Hong Kong. He argues that the Pearl River Delta region can support another hub airport.
The airport saw the opening of direct international services to Tokyo and Sydney in January, and expects at least another 10 international routes to be launched this year.
Ascend's Lu notes that Chinese airports are starting to proactively market themselves to airlines. To stand out they need to understand their market potential for international long-haul connections, and to be more engaged in the airlines’ strategies.
In the northwest, Chongqing Jianbei International airport is also targeting to grow its international network, as construction of a third terminal and second runway come close to completion. It saw 32 million passengers last year, but international traffic accounted for just 7% of the total figure. The target is to drive an international expansion to cover more than 50 global destinations.
“Going forward, we want to focus more on connections to the Middle East, Europe and Africa, because geographically, we have an advantage,” says the airport’s deputy general manager of marketing Patrick Chang, adding that there is also strong economic growth in western China.
Source: Cirium Dashboard
