North Korean market attracts China's Spring Airlines

PUBLISHED : Sunday, 29 November, 2015, 10:31pm
UPDATED : Sunday, 29 November, 2015, 10:31pm

Rising footfall by Chinese tourists in North Korea is prompting new airline offerings from China, in a market where they are proving to be no match for the "world's worst airline".

Budget carrier Spring Airlines, whose boss Wang Zhenghua is known for his penchant for bold forays into uncharted waters, is set to become the world's first airline other than the flag carriers of China and North Korea to operate flights to Pyongyang.

According to regulatory filings, Spring Air has applied to the Chinese aviation regulator to operate an Airbus A320 to the North Korean capital from Shanghai four times a week from February next year.

But Air Koryo, North Korea's national airline which consistently ends up at the bottom of the airline quality ratings by Skytrax and called the "world's worst airline" by The Economist and The Guardian, looks set to reign the clouds with its Soviet-era planes.

These planes are, in fact, "part of the experience" of visiting the Communist country.

Chinese travellers made 237,400 visits to North Korea in 2012, according to the latest available statistics from the national tourism bureau, almost doubling the figure from 2010. Most travelled by train.

Air China flies twice a week from Beijing, while Air Koryo flies five times, plus twice-weekly services to Shenyang along with charter flights from Shanghai, according to flight database OAG.

Packaged tour advertisements are an indication of the North Korean airline's market dominance. Popular deals on online travel agency Ctrip - starting at 3,980 yuan (HK$4,815) for a four-day package departing from Shanghai - all feature flying Air Koryo for the two-hour midnight flight.

Simon Cockerell, the general manager of Beijing-based Koryo Tours, which organises tours to North Korea for nearly 2,000 Western tourists a year, said: "We almost never use Air China. It is more expensive and more boring. Our customers want to fly Air Koryo. Your North Korea experience starts with Air Koryo."

According to OAG, Air Koryo operates 261 flights a year on the Beijng-Pyongyang route with two types of aircraft: the Tupolev TU204 and the Antonov AN148. The latter is the Ukrainian manufacturer's latest regional jet introduced in 2009.

Mark Clarkson, OAG's business development director for Asia, said Air Koryo's fleet of 17 planes consists of two Tupolevs, two Antonovs and 13 other old Soviet planes. "The fleet is obviously much older than most modern commercial fleet and the aircraft models do not have a good safety record," he said.

Cockerell, however, said Air Koryo was "very reliable" in safety as well as predictability, as the already sparse service by Chinese airlines was subject to frequent cancellation.

Asked if his agency would opt for Spring Air, he said that would "depend on the price, the schedule, and the reliability".

Spring Air, born out of Wang's travel agency business' charter flights, has become China's most profitable airline by profit margin. It owes much of its success to group traffic from its own travel agency.

"Pyongyang is one of many international routes we are looking at … Whether we can really open the route, how big the demand is, how frequent we will fly, I don't have any of that information at the moment. We are still studying it," Spring Air's spokesman Zhang Wu'an told the South China Morning Post.

Spring Air expanded its international capacity by 165 per cent in the first 10 months of the year, a rapid increase that China Merchant Securities said in a research note might put pressure on profitability in the short term.