Air traffic growth misses forecast as more opt for rail

PUBLISHED : Thursday, 10 February, 2011, 12:00am
UPDATED : Thursday, 10 February, 2011, 12:00am

Growth in mainland air traffic was lower than expected during the week-long Lunar New Year holiday, a decline analysts blamed in part on the increasing number of high-speed rail lines.

About 5.07 million passengers flew on mainland carriers from February 2 to 8. This was an increase of 6 per cent compared with the same period last year, the Civil Aviation Administration of China (CAAC) said on its website yesterday. But the growth is significantly lower than the 19.4 per cent increase for all of 2010. Analysts and airline executives suggested last year's double-digit rise was distorted by the low comparative base of a lacklustre 2009.

Still, the 6 per cent growth during the holidays was well below the CAAC's forecast of a month ago, when it projected the number of air passengers would grow 10.8 per cent year on year in the 40 days from January 19 to February 27, including pre- and post-holiday traffic.

Passenger growth was even lower at the country's big air hubs.

Beijing Capital International Airport passenger volume inched up by just 2.46 per cent to nearly one million passengers during the week, while Guangzhou Baiyun International Airport's passenger numbers were unchanged at 830,000.

The growing number of high-speed train services was identified by many observers as the cause of the slowing demand for air travel.

The Guangzhou-Wuhan high-speed line, which began operating at the end of 2009, has cut the journey between the two cities from eight to three hours. The Beijing-Shanghai high-speed line is expected to divert 20 to 30 per cent of airline passengers when it starts operating next year, aviation analysts said.

And a change in travel patterns is also to blame for the slower passenger growth over the holiday week, said Luo Zhuping, director of China Eastern Airlines.

'Mainland people started heading home for reunions earlier than before, lowering the growth in air traffic,' he said.

This unexpected shift also led to lower air fares during the holiday as airlines added charter flights to ensure demand could be met, Luo said. China Eastern and China Southern Airlines added more than 4,000 flights each in the 40 days from January 19 to February 27, while Air China added 3,000 flights.

Overall air traffic demand was low in the period, regardless of the shift in travel patterns, a CICC report said yesterday.

'The average growth in the 20 days from January 19 amounted to 9 per cent, compared with 15 per cent growth in the same period on average over the last 10 years,' the report said.

The securities firm said rampant inflation on the mainland and the country's tightening monetary policy would further suppress the growth in air traffic. But the softening in demand growth has shown signs of stabilising, thanks to economic growth. The firm forecast passenger growth of 11 to 12 per cent this year.