Air New Zealand is worried about New Zealand’s low profile in Beijing, less than two months before it’s inaugural flight to the Chinese capital.

Darline Liu, vacation manager of China’s first online travel agency, Ctrip, said more effort and funding needed to be put into marketing New Zealand in China.

She said, ‘I cannot hear any noise about New Zealand in Beijing.’

Air New Zealand’s international group general manager, Ed Sims, said the comments highlighted fundamental problems. ‘That concerns me hugely.’

Air New Zealand had spent more than $10 million in the Chinese market to promote New Zealand and this simply does not seem to have worked.

Daline Liu said the New Zealand Government’s decision to boost Tourism New Zealand’s Chinese marketing budget by $7 million over two years was not enough.

Too many Chinese did not know about New Zealand as a destination.

She said, ‘Because Chinese people don’t know much about New Zealand, New Zealand should pay much more money to promote the country.’

Education for travel agents was a key link in attracting more Chinese tourists. She said, ‘They don’t know about New Zealand, so they cannot tell people about New Zealand.’

In the past 10 years China has accelerated into the top five markets for New Zealand, and Air New Zealand has expanded capacity from three flights a week to five since starting its Shanghai service.

Ed Sims said flying celebrities out to New Zealand so they would blog about the experience and performing traffic-stopping stunts in Shanghai were more effective uses of cash than traditional advertising.

He said, ‘You have to think who you want to reach and how are you going to reach them.’ As this New Zealand rugby player is demonstrating here.

Personally I think they should hammer away at the scenic attractions and skiing. The writer has written a book on New Zealand and visited every town. He learned to ski near Queenstown. He considers it all magic.
Source: Stuff

China Southern Airlines expects to open 7-8 new international routes this year, expanding on a plan that saw it open 10 new foreign destinations in 2007. Chairman Liu Shaoyang said this year’s routes will originate mostly in Guangzhou and serve neighboring countries in Southeast Asia, in addition to a London flight scheduled to start in the fourth quarter.

It aims to increase the percentage of its revenue derived from international operations from the current 19% to 25%-30% in the next five years while expanding its fleet from 332 aircraft at Dec. 31, 2007, to 400 by 2010.

However, Chairman Liu Shaoyang said, domestic consolidation likely is necessary to maximize international competitiveness. He said Beijing is considering a reorganization of the domestic airline industry but a decision will not be made this year as carriers concentrate on August’s Olympic Games.

Last month he proposed a China Air Holding Co. that would hold stakes in China Southern, Air China and China Eastern Airlines and also would ‘be able to make investments in foreign carriers as well as conduct internal integration.’
Source:

The prospect of weekend ‘charter services’ from July 8 across the Taiwan Strait, as pledged by Taiwan’s President-elect, Ma Ying-jeou, could kick-start the process of opening one of North Asia’s biggest air travel markets. Currently, non-stop services are only permitted in the four major holiday periods on the Chinese calendar.

Daily charter services could be introduced this Northern Winter and be replaced as scheduled services in 2009, under Ma’s proposal.

Airlines on both sides are moving quickly to take advantage of the opportunity.Air China, for example, has applied to establish a representative office in Taiwan after Ma Ying-jeou is sworn in as President on 20-May-08.

EVA Air (shown in our illustration) forecasts a 50% increase in passenger numbers between Taiwan and the Mainland after the first stage of expanding the charter operations.

More than 1.5 million Taiwanese live on the mainland and are expected to travel more, if the inconvenience and added expense of a transit at a third point are removed. Furthermore, the Ma government proposes increasing ceilings on Mainland tourists, to help stimulate the island’s economy. Mr Ma plans to allow 3,000 Mainland arrivals per day to Taiwan from Jul-08, rising to 10,000 by 2012.

But the expansion of cross-Straits services is a serious looming threat for airports in Macau and Hong Kong and the carriers based there that have built large revenues from transfer services between Taiwan and the Mainland.
In terms of seat capacity, Cathay Pacific is the most exposed. Cathay accounts for almost one quarter of seats across the Taiwan Strait (from Hong Kong and Macau) at present, or around 38% including Dragonair. It will have to seriously consider how it will make good that shortfall.

Source: Centre for Aviation

Hainan Airlines, China’s fourth-largest air carrier, saw its unaudited net profit for 2007 jumped at least 300% from 2006.

In January, the airline estimated the rise in profit at 200% but that was being a tad conservative.

China’s airlines were buoyed last year by booming domestic demand for leisure and business travel, as well as the benefits of a rising yuan. Air China posted a 19% rise in second-half profit.

Hainan Airlines said details of its 2007 results would be published in its annual report, which will come out this weekend.

The airline posted a net profit of RMB181.6 million ($25.64 million) in 2006.
Source: Reuters

China Eastern, the nation’s third-largest carrier, has won official approval to establish a regional airline called Happy Airlines. (The name sounds a bit daft but so did EasyJet and Virgin the first time you heard them.)

The Beijing News reported that China Eastern will invest RMB400 million ($55.8 million) and take 40% in the new company, which will cater to west China’s middle and low-end tourist market.

The rest of the airline will be owned by the state-owned China Aviation Industry Corporation I (AVIC I), manufacturer of China’s first home-made passenger airliner ARJ-21.

The new airline will be based in Xi’an Xianyang International Airport in the country’s northwest and expects to hire transport plane pilots from the air force.

The newspaper said there are a handful of Chinese air companies running regional airlines, whose services are in huge demand but suffer from low profitability.

It further said, without elaboration, that China Eastern expects the new company to get beneficial treatment by the government. Beijing wants to boost the economy in the west to tackle unbalanced regional development. Note the illustration has nothing to do with the airline but this might be the image it wants to convey with its name.
Source: Economic Times

The Rhapsody of the Seas has just sailed from Kaohsiung harbor and out towards Hong Kong. That fact is nothing out of the ordinary. Such cruise liners frequently stop at Taiwan’s biggest commercial port. What was unusual was the cruise carried an unprecedented boatload of mainland Chinese tourists

The authorities in Kaohsiung were the first to admit that the tour party, which numbered only 668, was not enormous, nor was its expected impact on the local economy. But it was symbolic of change: the beachhead in a lucrative capital invasion for which the business leaders of Taiwan have been preparing for years.

If, as expected, the KMT under Ma Ying-jiu regains the Taiwan presidency next month, then there is expected to be a speed-up of the opening of economic ties between Taiwan and the mainland. Mainland tourism into Taiwan will be one of the most significant events.

There is huge pent-up demand for mainlanders to visit the ‘Precious Isle’, and they increasingly have big money to spend on eating out, medical care, and general tourist pursuits.

This is desperately important for the airlines of Taiwan. There are four of them and they are all bleeding money.

Taiwan’s overcrowded air passenger market began showing severe signs of financial strain this week when Far Eastern Air Transport, the island’s largest domestic carrier, admitted that a US$4.8m cheque for fuel had bounced.

Although the company obtained a one-month extension for the payment, the incident suggests the island’s aviation industry, which has been losing money for years, is operating in unsustainable conditions.

The airlines are caught by the ban on air transport between Taiwan and the mainland.

If the restrictions were to be lifted the airlines would become profitable and the whole of the economy would receive a boost. That is why the 668 tourists on the Rhapsody of the Seas are so important.
Source: Times Online

According to a report issued by MasterCard Worldwide the Chinese mainland is expected to record 21.6 million outbound tourists in the first half of 2008 with a year-on-year increase of 12.4%.

The report attributed the booming outbound travel market to the increasing number of middle-class Chinese.

It said the number of China’s middle-class families would rise to 100 million in 2016 from 35 million in 2006 in metropolises, such as Beijing, Shanghai and Guangzhou.

‘This, combined with the availability of low cost travel options, means Chinese travelers form a very influential group which is expected to continue to significantly shape trends in the travel business in 2008 and in years to come,’ said Dr. Hedrick Wong, economic advisor to MasterCard Worldwide in Asia Pacific.

China’s Ministry of Tourism in early January stated it recorded 40.95 million outbound tourists last year.

A joint on-line survey by market information provider Nielson and Ctrip.com, a domestic tourism website, said that about 11% of Chinese netizens whose family monthly income tops RMB8,000 ($1,095) want to travel abroad.
Source: China View

China plans to build 97 new airports by 2020. China’s General Administration of Civil Aviation said the $89 billion undertaking over the next 12 years will bring the total number of civilian airports in China to 244, up from 147 in 2006.

The new airports will be built in five main regions of the country — north, east, south-central, south-western and north-western.

When the expansion is complete, it would mean that 82 percent of China’s population — expected to hit 1.45 billion people by 2020 — would be living within 100km — or a 90-minute drive — of an airport.

Currently, about 60% of the popularion lives with this range.
China’s air passenger volume rose by 15.3% to 51.9 million in the third quarter of 2007, and air freight volume increased by 11.5% to 1.05 million tons.
Source: CargoNews Asia and
Bloomberg

Queensland business, tourism, investment and aviation bodies have launched a campaign to attract direct air services between mainland China and Brisbane.

The move comes as the airline China Eastern is about to begin a trial of Brisbane-Shanghai services that will end in February.

Note that all of the states in Australia compete viciously for the tourism dollar. The rivalry is especially marked between Queensland and Sydney. Queensland is not happy that the bulk of tourists go to Sydney at least as a first stop. And a fair percentage never gets past that.

So six Queensland tourist groups have formed the China Aviation Action Group.

Chairman Jim Carden, of the Brisbane Airport Corporation, said success of the China Eastern service was vital to the long-term future of direct services to Queensland. His group hoped to increase awareness among business and tourism stakeholders in both markets of the need for direct non-stop air services.

He said the China market was growing by about 20% a year and there had been 150,000 visitors to Queensland last year.

But a lack of direct flights meant travelers were forced to endure stop-overs at cities such as Singapore, Hong Kong and Sydney. (The word ‘endure’ comes fom the announcement. Whether it is correct in the context of those three amazing cities is another question.)

Jim Carden said, ‘There is a huge opportunity for both Australian and Chinese airlines to service the Queensland market.

‘With the opportunities that have arisen with the resources boom, the sustained growth in the Chinese economy, the attractiveness of Australia as a destination and the Beijing Olympics, we are convinced that the benefits will begin to flow for airlines willing to take on direct services to Brisbane.’
Source: News.com.au

Cathay’s first Boeing 777-300ER aircraft has two huge General Electric engines which give it fuel efficiency. Nowadays, with the price of fuel, that is desperately important.

The delivery of Cathay’s first 777-300ER last month also means a better sleep for long haul passengers. First and business-class seats, but of course, electronically recline into fully flat beds. But economy class provides seats that recline within a fixed shell to boost space.

The story is that Cathay had research showed passengers want more comfort, privacy and control over their immediate living area. One would have thought a chat with any ten passengers would have brought precisely the same result.

Cathay’s investment coincides with the fact that the total number of travellers passing through Chinese airports rose 17% last year and is expected to grow by 14% annually through 2010.

Eleven airlines, including Cathay, now serve the Vancouver-to-Asia market. Canadians’ visits to China surged 56% in 2006.
Cathay predicts that, by 2020, China will have 12 million aircraft movements a year - up 400% from today.
Boeing forecasts that Asia-Pacific air traffic will expand at 6.3% a year for the next 20 years.
Of the 8,350 new jets Asia will need during this period, China alone is expected to account for about 3,000 new aircraft deliveries.

The illustration is the Boeing 787 Dreamliner Engineering flight deck simulator in Seattle.
Source: Canada.com