Transport and logistics

Hainan Air to fly to New York from southwest China, as business goes on under spotlight

PUBLISHED : Thursday, 19 October, 2017, 10:07pm
UPDATED : Thursday, 19 October, 2017, 10:07pm

HNA Group, one of the four Chinese enterprises under regulatory scrutiny since June for its outsize overseas purchases, said its airline will commence flying to New York next week from two of the biggest cities in southwestern China, in a sign that its business operations are uninterrupted under the government’s spotlight.

Hainan Airlines, the fourth-largest Chinese carrier by fleet and a HNA unit, will begin flying non-stop to the US east coast from Chengdu and Chongqing from October 27, using Boeing’s 787-800 aircraft.

The Chengdu-New York service will depart every Thursday and Saturday in summer and autumn, switching to every Tuesday and Saturday in winter and spring, HNA said on its website. A separate service from Chongqing will serve New York every Wednesday and Friday in summer and autumn, switching to depart on Mondays and Fridays in winter and spring, HNA said.

The two new routes, following the September 20 commencement of Hainan Airlines’ Shenzhen-Brisbane route using the Airbus 330-200 jetliner, shows the company’s sprawling operations appear to be unaffected, even as its acquisitions had been put on a short leash.

In June, the China Banking Regulatory Commission ordered the country’s banks to watch their exposure to loans owed by HNA and several other Chinese enterprises, amid concern over their aggressive, debt-fuelled shopping spree.

This week, HNA announced a 50 billion yuan (US$7.6 billion) plan to assemble an online travel and leisure platform from its stable of assets, including Hainan Airlines, a string of golf courses in the US, and a 25 per cent stake in Hilton hotels. The platform, with a mobile application called HiApp, could potentially challenge China’s dominant online travel service for business.

Capacity growth among airlines serving routes between North America and China’s second-tier cities is growing fast. The frequency of travelling more than tripled in the first seven months of 2017, compare with a 79 per cent increase in the same period last year, according to data by Crucial Perspective.