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Private Airlines Bring Fierce Competition in Aviation Industry
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The influx of non-government capital to the civil aviation industry has resulted in the establishment of 14 non-state airline companies in China, which has helped break the state monopoly of the aviation market.


Dongxing Airlines based in Shanghai, one of the companies established five months ago, has signed an agreement for leasing and buying 20 Airbus aircraft at a cost of 12 billion yuan (US$148 million).


Also in Shanghai, the Spring and Autumn Airlines said that during July to October last year alone, the company carried 74,552 passengers with only one plane operating 436 flights.


"Our occupancy rate reached 95 percent," said Wang Zhenghua, president of the company.


While the non-state airlines are seeking to increase the number of craft and flights, Okay, which made the "maiden voyage" of the non-state airlines, said it would put an eye on cargo transportation.


All this has triggered fierce competition among Chinese airlines and helped improve their services, observers say.


China's three major airline groups have felt the pressure, not only from the fear of declining market share, but also the fact that their pilots are leaving for the non-state competitors.


However, Yang Yuanyuan, director of the General Administration of Civil Aviation of China, said the government will continue the policy of opening the aviation market.


The ultimate goal for the reform of China's civil aviation industry is to make air travel available to more ordinary Chinese, said the pilot-turned official.


"The pressure from non-state airlines will become the top driving force for state-owned airlines to make improvements," he said.


(Xinhua News Agency January 2, 2006)


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