China Southern Airlines and HNA's Yangtze Express attack China Eastern's market share at Shanghai

The competitive and fragmented aviation market of Shanghai will become more complex with China Southern Airlines' Jun-2014 establishment of a branch while HNA seeks to have locally-based Yangtze River Express transition from freight services to freight and passenger services. China Southern's enlarged Shanghai presence will follow its notable presence in Beijing and hub in Guangzhou. The long term could see China Southern attempt to launch long-haul routes from Shanghai, which have been lacking, although China Eastern Airlines is seeking to change this. Yangtze River Express holds some prime slots that could be used for passenger service, finally giving the HNA Group a presence in Shanghai.

China Eastern's market share in Shanghai has declined faster than Air China's in Beijing or China Southern's in Guangzhou, and this is likely to continue. Shanghai's Hongqiao and Pudong airports collectively handled 82.8 million passengers in 2013, just shy of Beijing Capital's 83.7 million. Over the next year, a slot expansion at Shanghai Pudong will increase the number of slots for existing and new entrants.