Foreign airlines boost coverage in western areas

Foreign airlines are expanding their route networks in western China in response to the strong economy and increasing passenger demand there.

British Airways Plc, which is based in London's Heathrow Airport, said on Wednesday it will launch a non-stop route between London and Chengdu, Sichuan province, in September 2013.

By the end of the decade, the carrier will also fly to at least other four or five cities in China, said Willie Walsh, chief executive officer of the International Airlines Group, BA's parent company.

The carrier will run three flights weekly on the Chengdu-London route, using Boeing 777 airplanes with four cabins.

And BA plans to increase the frequency to five flights a week in 2014, said Walsh.

"We are confident that the new route will prove popular with customers traveling between the two major economic hubs," said Walsh.

His confidence is supported by Chengdu's rapid economic growth, he said.

It took BA over seven years after choosing Shanghai as its third Chinese destination to select Chengdu as the fourth one, while other foreign airlines expanded in a more aggressive way in the Chinese market.

The fact that BA is based in Heathrow, one of the world's busiest airport, limited its expansion potential in China, said Walsh. After it bought British Midland Airways Ltd in April, IAG got more slots in Heathrow, which gave it the opportunity to expand, he added.

BA is not the first foreign airline eyeing China's western regions. The airline's planned route will be the second in Chengdu linking China and Europe. Air France-KLM Group has run its Chengdu-Amsterdam route since 2006.

And at the end of 2011, Etihad Airways introduced a Chengdu-Abu Dhabi route.

"Chengdu is expected to have four routes to Europe and the Middle East next year respectively," said Chen Zhongwei, director of the Chengdu Logistics Office.

Doha, Melbourne and Frankfurt will be the next foreign cities to become connected to Chengdu, Chen said.

Other cities in western China are also welcoming additional international routes from foreign airlines.

Qatar Airways Co selected Chongqing as its fifth Chinese destination in November 2011, while Finnair Oyj added Chongqing to its network in May 2012.

"Overall, the numbers of international flights and routes in these regions are not very large now," said Li Lei, an aviation analyst at Citic Securities Co Ltd.

The market in western areas is still in a preliminary stage, Li said, and the airlines are not investing too much in air capacity there. "They are occupying positions through new routes and waiting for a boom in the market," Li added.

However, some business insiders question whether foreign airlines are too centralized in southwest cities, which could make competition stiffer there.

Meanwhile, local governments are working hard to lure foreign carriers by introducing supportive policies, including direct subsidies to airlines.

"Local governments will help the airlines open new international routes to Chengdu as soon as possible," said Cheng at the Chengdu Logistics Office.

Local airports have also expanded their capacity to accommodate more carriers.

Chengdu also plans to build a new airport in Jianyang, a city nearby, said Yan Yuhua, manager of the aviation market department of the Chengdu Shuangliu International Airport.

wangwen@chinadaily.com.cn

(China Daily 12/20/2012 page16)