China Southern Airlines considers removing first class, with China's new government austerity

China Southern's high profile expansion into long-haul markets has not all achieved results. Load factors are high but yields low, with CEO Tan Wan Geng in a surprisingly frank admission conceding, perhaps the obvious, that long-haul profits for Chinese airlines are "very difficult". Most long-haul routes - even from higher-yielding cities like Shanghai - are loss-making, while they are profitable for international competitors.

Pressure is increasing as the country's new leadership imposes austerity measures, some cosmetic, some real, ranging from fewer dishes at banquets to cuts in international travel spending. Airlines are feeling the heat and China Southern as a result is considering removing first class on aircraft that also have business class. China Southern has first class on A380s, A330s and its forthcoming 787s. The carrier would in this case consolidate to having only a business class, or at least reducing the number of first class seats.

Such a move would add China Southern to the growing list of carriers reducing or removing first class from some of their aircraft, including Emirates, Lufthansa and Qantas.