Airlines keep capacity tight despite boom in China travel demand
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Scheduled flights into China during January, February and March are up no more than 2.9 per cent this week compared to last week.
PHOTO: EPA-EFE
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BEIJING – The world’s airlines are taking a cautious approach to China’s reopening, reluctant to immediately change up schedules and divert planes from other routes despite the internal pent-up demand for international travel.
Scheduled flights into China during January, February and March are up no more than 2.9 per cent this week compared to last week, according to aviation data provider Cirium. That is fewer than 100 more flights each month.
Planned inbound services for the remainder of the year are little changed – a sign that China’s relaxation of quarantine restrictions from Jan 8
“I don’t think airlines will shift capacity from what they’re doing now in China,” said Mr Subhas Menon, director-general of the Association for Asia Pacific Airlines.
Most will rather wait to assess the situation, with Hong Kong, which also recently did away with many Covid-19 restrictions, being a useful testbed, he said.
Carriers’ lukewarm reaction to news that China will from early next year no longer subject inbound travellers to quarantine does not chime with the intense desire for overseas travel from people living in Asia’s biggest economy, most of whom have all but been locked in for the past three years.
Prior to the pandemic, China had a massive outbound travel market.
Mainland residents reacted swiftly to Monday’s news with bookings for outbound flights surging by 254 per cent on Tuesday morning versus the same period the day prior, Trip.com Group data show.
The top five destinations were Singapore, South Korea, Hong Kong, Japan and Thailand. Flight bookings to Singapore jumped 600 per cent, while bookings to the remaining four destinations soared around 400 per cent.
Airlines in those countries, however, were not rushing to add capacity.
Singapore Airlines said it will “continue to monitor the demand for air travel
The national carrier will reinstate its Singapore-to-Beijing passenger service on Fridays from Dec 30, on a fortnightly basis. This comes three months after SIA reinstated flights from Beijing to Singapore on Sept 27. These flights operate every Tuesday and Friday.
Hong Kong’s Cathay Pacific Airways welcomed the announcement and said it will “continue to communicate with relevant authorities and increase our passenger capacity to and from the Chinese mainland as much as possible”.
Korean Air Lines said it plans to increase flights to China after the two countries mutually agreed to boost connectivity. Even though China has lifted quarantine rules, there is still a travel ban on group tours to South Korea that has been in place since 2017 – retaliation from China in response to a US-led deployment of an anti-missile shield in South Korea known as Thaad.
Korean Air currently operates nine flights a week to seven cities in mainland China and will boost that to 15 flights to nine cities starting from January, with the two additional cities being Shenzhen and Xiamen on top of Shenyang, Shanghai, Guangzhou, Dalian, Qingdao, Tianjin and Nanjing.
“There aren’t that many inquiries from Chinese, or from Koreans, for travel packages yet,” said director Yook Hyun-woo from Modetour Networks, a major travel agency in Seoul. “We’re still worried that a resurgence of the virus during winter may cool demand.”
A Japan Airlines spokesman said it was unfortunate that the country had strengthened its border measures for China, but noted that the carrier would act in accordance with government guidance.
Japan said earlier this week it will require a negative Covid-19 test result
Travellers from China made up nearly one-third of the 32 million visitors that flocked to Japan in 2019, prior to the pandemic.
Qantas Airways in Australia, another popular destination for Chinese tourists, said it would “keep customers updated about any plans we have to recommence flights into China”.
Other foreign carriers, meanwhile, remain limited by lingering pandemic curbs in terms of what capacity they can add back to China.
US airlines were restricted on the number of flights they could operate to China under an agreement between Chinese authorities and US Department of Transportation that dates to 2020 when the pandemic upended aviation. That accord would have to be modified for them to expand their China capacity.
United Airlines Holdings is “currently evaluating the market demand and operating environment to determine when it’s right for us to resume additional flight operations to mainland China”, spokesman Joshua Freed said. United currently flies between San Francisco and Shanghai four times a week.
Delta Air Lines said it had no changes to announce for its China service. The airline has been flying to Shanghai from Detroit and Seattle with a stop at Incheon International Airport in South Korea for crew changes. American Airlines Group did not immediately respond to a request for comment. American Airlines currently operates twice-weekly flights from Dallas Fort Worth International Airport to Shanghai with a stop in Seoul.
Deutsche Lufthansa said it looked forward to increasing capacity and remains “committed to this important market”. The German group currently operates 17 weekly flights from Europe to Chinese gateways including Beijing, Shanghai and Hong Kong.
Starting from Jan 16, Austrian Airlines will add one more weekly flight from Vienna to Shanghai.
International airlines will also be seeking clarification around aircrew and whether they are able to stay overnight in China now that quarantine has been dropped. Currently, many international carriers have to fly into China, drop off passengers and then fly to Seoul for the crew to spend the night there before flying back to China the next day to pick up fresh travellers for an onward overseas flight.
The industry’s main trade body, the International Air Transport Association (Iata), also said the requirement for pre-departure Covid-19 tests needs to be removed.
“It’s also crucial for the entire aviation value chain in China to be well prepared and adequately resourced to handle the expected surge of air travellers, so as to avoid the travel disruptions and problems seen elsewhere in the world when borders reopened,” said Iata’s regional vice-president for North Asia Xie Xingquan.
Any real explosion in outbound travel, however, may not happen until after Chinese New Year, which in 2023 falls in late January, or even some months after that.
While online searches for Chinese New Year outbound flights were up 300 per cent as of Dec 27, searches for Labour Day flight tickets around the holidays in early May were up 600 per cent, VariFlight data show.
International ticket prices also are not showing any meaningful fluctuations and are still elevated.
Polls on Chinese social media indicated high fares could be another deterrent. “I got so excited at the news and then the flight prices calmed me down,” one person wrote on an account on Weibo, which is similar to Twitter. “Will wait and see instead.”
VariFlight analyst Wang Yi said international flight volumes will rebound gradually and probably “hit a real turning point by summer 2023”. BLOOMBERG
