‘Chinese travel seasonality presents a challenge to sustainability,’ says CAPA

The Center for Aviation (CAPA) has analyzed the results of China’s aviation trends over the past few years and concluded that “China’s concentrated and en masse travel periods present a challenge for sustainability.”

This is one of the conclusions of CAPA’s latest report, announced after the peak period for migration and traveling in China.

According to the report, some airlines take advantage of this period to raise prices in order to boost their revenue.

Despite the optimistic results expected for the period, the main question lies in what happens during the rest of the year, as the seasonal large scale travelling reportedly presents huge challenges to both local and foreign airlines, whose annual profitability  often depends on the few weeks of travel during Chinese New Year, a brief summer peak, and the autumn Golden Week holidays.

CAPA states that as international traffic has remained strong, expanding by an estimated 9.3 million passengers in 2016 and representing 22 percent growth, Chinese airlines have continued to shift to the international market, and Air China has focused more on international than on domestic markets.

In a brief overview of this year’s first results, CAPA provides China Southern Airlines as an example, showing that the company flew over 250 million passengers in a single day, with neighboring Guangzhou airport breaking traffic records two days in a row.

In this sense, it may be evaluated that traffic for the New Year is growing faster than the annual average.

It is estimated that China Eastern will carry 14 percent more passengers during the New Year than in 2016, although their yearly growth is also expected to remain steady at 6.8 percent. Meanwhile, China Southern expects to carry 12 percent more passengers during the New Year while its annual growth should be only 4.3 percent.

At the same time, Tourism & Transport Forum Australia (TTF) forecasted on January 25 that the number of Chinese visitors arriving to the country would increase by 81,000 during the Chinese New Year celebrations.
The report also states that “there are still too many factors” influencing industry growth, most of which are related to infrastructure, airspace and state planning. The report further states that “China continues to have pent up demand and air travel is not as closely correlated to GDP growth as other global examples suggest.”

Still, the Center remarks that 2016 was definitely a good year and “an envy of most other markets,” noting that “smoother year-round demand would help aviation providers.”  RM