China Southern is likely to be the first airline in the world to operate the Boeing 787 on services to Australia. President & CEO Tan Wangeng announcing Wednesday that the airline “will spare no effort in building the Canton Route into a premium product” to be operated by Airbus A380s and Boeing 787s.
Already big and getting bigger. China Southern is the largest passenger airline in Asia, carrying over 80 million passengers in 2011. The third largest by market capitalization. The sixth largest by fleet size. And, Skytrax’s most improved airline of 2011.
China Southern in 2015
International operations currently account for only 18.4% of the carrier’s Available Seat Kilometres (ASKs), the smallest of China’s ‘big three’ airlines. 80% of its domestic route network, and 81.6% of its ASK capacity competes directly against high speed rail. The result? China Southern is turning to international markets with the aim of increasing its international ASKs to 35% by 2015.
Chairman Si Xianmin noted in a recent interview that “[we’re] looking at route expansion into South America, Africa and other emerging markets to expand our hub network. The broader vision of the Canton Route is to build Guangzhou as a global, comprehensive, long-haul aviation hub”.
Currently operating 35 weekly services to 5 Australian cities, plans see this increasing to 55 weekly return services (110 total services – China Southern considers a one-way flight, one service) to Australia by 2015. In addition, South American services are likely to operate through Nairobi, home of Skyteam partner Kenya Airways, linking three of the world’s largest developing markets.
Ürümqi is China Southern’s strategically located second international hub. A cooperation agreement signed by the airline and the Xinjiang Autonomous Region government, has seen Ürümqi Airport’s passenger traffic grow to become China’s fourth largest international airport. From Ürümqi the carrier offers services to the middle east, Turkey and following the resumption of services to Tashkent in July all of the CIS republics (except Moldova). Supported by expanding minerals exploration in the region, could China Southern leverage Ürümqi’s strategic location to reshape sixth-freedom traffic flows across Asia?
Opportunity much? Nearly 3 billion people live within 4.5 hours flying time of Urumqi. China Southern’s current international network from Urumqi, and connections to its other major China hubs.
The Baiyun experience
Tan says that “More than 30% of the passengers travelling on this [Canton] route are from Australia and Europe”, but if it is to win greater market share from other ‘Kangaroo route’ carriers, the airline will need to substantially improve the transfer experience at Guangzhou’s Baiyun Airport.
One of those ‘only in China’ experiences, transferring is in many ways akin to being in a barnyard cattle run, in which the ground staff aren’t really clear about where they are leading the cattle.
Onto the tarmac? Your colleague’s sign says that way. NO! Which bus? That one…No, this one! Both buses end up at the same location – domestic baggage claim. But shouldn’t I be at an international terminal? Need I go on?
The wings of China? China Southern’s special new 787 Dreamliner livery. Photo: Wcarn.
Ghastly transfers aside, China Southern is developing a winning on-board product as a result of substantial focus and investment. While the older Airbus A330s compare with Qantas’ domestic B767s, their latest A330s are almost A380 quiet, feature Thales’ TopSeries touch screen IFE, and a very comfortable 34/35 inches of legroom throughout economy.
The carrier’s first three Boeing 787s are currently completing change and incorporation rework and will be delivered in 4Q 2012. The aircraft will feature the same interior as China Southern’s A380s with 4 first class suites, 24 business seats (78inch pitch), and 200 economy (33in pitch) with Panasonic’s eX2 AVOD IFE throughout. IFE content is still not what you would find on other international carriers, limited by China’s censorship restrictions.
China Southern’s A380s, but what’s kept them domesticated?
Sources say upon EIS in 2011, the Civil Aviation Authority China (CAAC) restricted operations over concerns that cockpit flight crew English levels were insufficient to operate in a monolingual English environment, particularly in relation to the aircraft’s Electronic Flight Bag (EFB). An extensive flight crew training programme has taken place over the last year, and it seems the CAAC’s restrictions are soon to be been lifted.
Three A380s are currently in service, a fourth arrives in September, with the fifth and final aircraft scheduled for delivery in early 2013. Configured with 8 first suites, 70 business class seats, and 428 economy, the carrier’s five A380s will be deployed on daily Guangzhou – Los Angeles, and likely later daily Guangzhou – Paris and/or London.
Sydney may also eventually see A380 services, Tan recently saying “on our current Sydney route we operate [a] double daily using our A330 aircraft and the load factor has been very satisfying. We are now exploring the possibility of operating the A380 on this route, which means we can operate a triple-daily service. But we have to study if the market will be big enough to digest this capacity”.
China Southern is on the verge of being unleashed in the same way Emirates was 10 years ago. A blue dragon is rising, and it’s winging its way to a city near you.