Hong Kong Express Airways, a small local carrier, has been granted air rights to fly to Beijing and Shanghai, introducing more competition to the potentially lucrative routes.
Hong Kong Express is the third local carrier to serve the mainland's two busiest airports after Cathay Pacific Airways and Dragonair. It is due to start twice-daily services to both cities by the end of March.
'We welcome the decision of the Transport and Housing Bureau,' said Hong Kong Express president Ronnie Choi said. 'It is a gesture by the government that it wants to introduce new competition into the industry.'
The move came after Hong Kong and the mainland expanded an air service agreement in December. It allowed an additional Hong Kong carrier to fly to Shanghai and Beijing in March, during the summer schedule and another airline - possibly Hong Kong Airlines - in October during the winter schedule. Mainland carriers will be granted reciprocal air rights to fly to Hong Kong.
But industry watchers said that Hong Kong Airlines may have to wait longer. According to the Transport and Housing Bureau's quota system, only three new flights per route will be granted this year. After Hong Kong Express gets two flights, Hong Kong Airlines would only get one, even if they win air rights for October, and it may have far too little market share to compete.
Officials from the Transport and Housing Bureau said last month that they wanted to see new carriers operated in a competitive way.
