Air China will begin using the newly constructed Terminal 3 of the Beijing Capital Airport in March 2008. Which will give plenty of time for all the small problems — no new airport has ever opened without problems — in plenty of time for the Olympic Games for which it will be the main supporting building.

The one million square-meter Terminal 3 project also includes a 3,800-meter-long by 60-meter-wide runway, which will accommodate the Airbus A380, the largest aircraft in the world. Terminal 3 will double the current passenger capacity of the Beijing Capital Airport by 2015.

Mrs. Lan Zhang, senior Vice President of Air China, said, ‘Air China is proud to be the flagship tenant in Beijing’s fabulous new Terminal 3. Our familiar customers will benefit from the move to this new facility, and our new passengers joining for the 2008 Olympic Games will also be pleased with their state-of-the-art experience here in Terminal 3.’

The new Li-Tian highway will run north of the airport, while the airport railway connects the city to the airport. Passengers may take the city railway from Dongzhimen to the airport transportation center, located at the south side of Terminal 3. The airport will also provide 7,000 parking spaces next to the Terminal 3 building.

Terminal 3 will serve Air China — China’s flagship air carrier — and its alliance airline companies, as well as foreign airlines. The project took three years and nine months to complete. It covers an area of approximately 1 million square meters.
Source: Forbes and People’s Daily Online

Li Jixiang, the chairman of Air China Chairman, said there is a need for the Chinese aviation industry to create ’super-carriers’ able to compete on a global level, and that his airline was up to the challenge.

The comment also leaves room for the flag carrier to further pursue a merger with China Eastern, a move earlier denied them, but one that Air China still hasn’t ruled out for further consideration.

In a sense it has already expanded through consolidation. On 28 October, 2002, Air China consolidated with China National Aviation Corporation and China Southwest Airlines. During 2004 as part of a consolidation of the Chinese aviation industry Air China absorbed Zhejiang Airlines (a subsidiary of CNAC).

Li Jixiang said, ‘Air China is still too small. To realize this super-carrier, Air China can do it; other airlines can also do it. Other airlines can also buy Air China — we welcome anyone to buy Air China shares. As long as China produces a super-carrier, I’ll be happy.’

Chairman Li brought up one option for growing as being small acquisitions as it has before in the bid to create the super-carrier. It will take a lot of acquisitions for it to be able to compare with, say, United Airlines with a 460-strong fleet compared to Air China’s 68.

Not helping as the delays by Boeing in the delivery of the 787 Dreamliner. The six month delays on initial deliveries could hinder the carrier’s planes for aggressive route developments to serve the Beijing Olympics.

Air China and Air New Zealand now offer code-share service connecting China, Australia, and New Zealand. Air New Zealand has become the twentieth airline to partner with Air China in cooperative code-share service.

Mrs. Zhang Lan, Senior Vice President for Air China, said, ‘Partnering with a strong, Star Alliance carrier like Air New Zealand is a great benefit for travelers to and from China. We are proud to join with Air New Zealand in expanding passengers’ choices to fly to more destinations, and we believe that Air New Zealand customers will be pleased with the levels of service they will receive onboard our modern Air China fleet.’

Air China will code-share on Air New Zealand flights between Shanghai and Auckland, as well as on some flights between Australia and New Zealand. In return, Air New Zealand will code-share on Air China’s international services between China and Australia, which connect the four major cities of the two countries, namely Beijing and Shanghai with Sydney and Melbourne.
Source: etravel blackboard

Under the 2004 bilateral agreement China opened its air hubs and major coastal cities to US airlines. From this year, under a new, more extended bilateral agreement it will open its central hinterland (effectively all of China) to US carriers.

As a result Chinese airlines will feel the heat of competition. US carriers can now fly to provinces such as Anhui, Hunan, Hubei, Jiangxi and Shanxi.

According to Li Lei, an airline analyst with Zongxin Investment the new deal will open up all provincial capitals to US carriers. Restrictions on air cargo flights between the two countries will be lifted by 2011. This means, notes Li Lei, ‘potential cargo routes reserved for Chinese operators will be taken away by powerful US cargo airlines.’ The use of that word ‘powerful’ suggests that Li Lei may not be totally without bias.

Under the deal, US carriers will be able to operate 23 daily round-trip flights by 2012, up from 10 currently. China will have the right to fly the same number of flights to the US.

US carriers are eager to expand their flights after using up their quotas under the 2004 deal while Chinese carriers have still not utilised more than half the flights permitted. The reason is simple. To make a quid out of the airline business you need two way traffic. Passengers and cargo there, passengers and cargo back. Flying empty planes is a way to lose serious money.

From China to the US it is not a major problem getting a full load. The other way around is seriously difficult. US passengers, by and large, tend to book on US airlines.

According to the Civil Aviation Association of China the new deal offers an additional 13 flights for both sides, but as the Chinese side has no capability to use these flights, only the US operators will benefit.

This is true. Which means the Chinese operators are going to have to rethink the way they operate. To survive costs have to be cut, service improved, loads made more profitable. This is not easy, as airlines all over the world have discovered.

Tian Baoping, chief of the China Civil Aviation Management Institute, said Chinese operators need to work harder for self-preservation, which could be achieved faster by joining aviation alliances. He said, ‘Only internationalisation can uplift local airlines and airports and strengthen the civil aviation chain.’

China carriers have already started making moves to join alliances. China Southern is expected to become a member of the SkyTeam alliance by November; Shanghai Airlines may join the Star alliance by year-end; Air China has also expressed its interest in joining the Star alliance; and China Eastern Airlines is preparing for accession to the Oneworld alliance.

Membership in the alliances can help fill Chinese passenger and cargo aircraft as well as cut costs because of discounts achieved through the joint purchase of fuel, parts and freighters by the alliance members.

Another method of boosting international flights for Chinese carriers is to invite foreign operators to form joint ventures such as the Lufthansa-Shenzhen Airlines joint venture of Jade Cargo. China Southern is currently in talks with Air France-KLM on a joint cargo venture, while China Eastern is close to clinching a deal to sell a 25% stake to Singapore Airlines.

The airline business is tough and is about to get tougher. There will undoubtedly be casualties.
Source: CargoNews

Swiss International Air Lines will launch its Shanghai-Zurich direct flight in March 2008, using its Airbus A340 fleet. There are no direct flights at present between the Chinese mainland and Switzerland.

The bankrupt Swissair (how can a Swiss airline go bankrupt? It seems totally against the odds — but it happened. And Swiss International ended up being owned by Lufthansa) suspended its direct flight from Shanghai and Beijing to Zurich in 2002.

With Air China and Shanghai Airlines due to join the Star Alliance next year, Swiss International is also expected to collaborate with two domestic partners to offer its customers services from Shanghai to other Chinese destinations.

Beijing is also set to appear on the company’s timetable next spring, under a code-share operation with Lufthansa via Munich.

Swiss International Chief Executive Officer Christoph Franz said, ‘Our new services should ensure that Switzerland enjoys attractive air connections with what is currently the world’s fastest-growing market.’

In truth it goes much further than that. Typically, fares out of Switzerland are much lower than fares from London. Many companies have so constructed their company’s travel plans that their executives fly first to Zurich and then on to the final destination. So this flight will not just be attractive to Swiss customers. It has implications throughout Europe.

Since last November, Switzerland’s national airline has added five Airbus A320-family aircraft to its European fleet and has introduced two additional Airbus A330s.
Source: Shanghai Daily