10-Oct-2011 2:58 PM

Kunming Wujiaba Airport outgrown; Massive new Changshui facilty to open in early 2012

Analysis

Kunming Wujiaba International Airport (KMG), the gateway to Southwest China's Yunnan Province, was the seventh busiest airport in China in 2010. However, a growth rate of (just) 6.6% made it the slowest growing among China's 12 largest airports. Amid rising demand and capacity constraints, Kunming is nearing completion on a USD3.6 billion replacement, Kunming Changshui International Airport, which is scheduled to be operational in early 2012 and become the fourth largest aviation hub in China. Currently China's largest airport construction project, Changshui is aimed at developing Kunming as an economic area and key transportation hub for the region to Southeast Asia. Upon opening, Kunming Xiaoshan International Airport will be equipped with two 4000m runways and a 400,000sqm terminal capable of handling up to 27 million passengers p/a, with this capacity expected to double within five years.

Kunming is one of several fast-growing airports in western China to have outlined ambitious growth plans. Chengdu, Xi'an, Chongqing, Wuhan and Chongqing are all vying for the role as the nation's fourth largest aviation hub (after Beijing, Shanghai and Guangzhou). In coming months, CAPA will continue to review the progress and ambitions of Chongqing's rivals in western China. At present, Chengdu Airport, which has already been reviewed by CAPA as part of this airport series, is the largest of the ambitious western China airports. However, Chongqing, which has also been reviewed, together with Xi'an, have reported the fastest growth rates recently, according to CAPA's Airport Traffic Benchmark Tool.

See related articles:

Traffic comparison for Chongqing Airport, Chengdu Airport, Xian Airport, Wuhan Airport,
Kunming Airport: Jul-2008 to Jul-2011

Traffic growth comparison for Chongqing Airport, Chengdu Airport, Xian Airport, Wuhan Airport,
Kunming Airport: Jul-2008 to Jul-2011

Kunming Airport handles 20.2 million pax in 2010 to be China's seventh busiest airport

Kunming Airport, operated by Yunnan Airport Group and one of the oldest airports in China, handled 20.2 million passengers in 2010. It was also the seventh busiest airport in China in terms of cargo traffic and the eighth largest in terms of aircraft movements. The airport is, however, showing signs of stress, due to its low water table, the age of the terminal and congestion at its sole 3400m x 45m runway. The airport is constricted due to its proximity from downtown Kunming (just 4km).

Airports in China with more than 10 million passenger numbers p/a: 2010

Passenger volumes double over past seven years

In line with the region's strong economic growth, traffic at Kunming Airport has grown rapidly in recent years, and has held the position as the seventh largest carrier by passenger numbers since at least 2005. Passenger volumes have more than doubled at Kunming over the past seven years, increasing over threefold over the past decade.

Kunming International Airport passenger growth: FY1997 to FY2010

However, based on current capacity (seats) data for China, Kunming (with 562,500 system seats per week) has slipped to eighth largest, having been overtaken by Xian, with 589,242 weekly seats. The airport also ranks eighth in terms of domestic seats but 10th in terms of international seats.

China's largest 15 airports by seats (total, domestic and international): 10-Oct-2011 to 16-Oct-2011

Rank	Airport	Total Seats	Domestic seats	International seats
1	Beijing Capital International Airport	1,868,140	1,397,246	470,894
2	Shanghai Pudong Airport	1,132,835	582,297	550,538
3	Guangzhou Baiyun Airport	1,083,988	894,937	189,051
4	Shanghai Hongqiao Airport	817,127	757,511	59,616
5	Chengdu Airport	711,275	677,575	33,700
6	Shenzhen Airport	667,619	638,099	29,520
7	Xian Airport	589,242	580,966	8276
8	Kunming Airport	562,500	530,542	31,958
9	Chongqing Airport	530,309	516,364	13,945
10	Hangzhou Airport	479,893	422,613	57,280
11	Xiamen Airport	453,581	396,963	56,618
12	Changsha Airport	382,794	368,488	14,306
13	Nanking/Nanjing Airport	343,138	317,962	25,176
14	Qingdao Airport	335,529	295,834	39,695
15	Urumqi Airport	321,187	301,652	19,535

New Kunming Airport - Kunming Changshui International Airport - to open in early 2012

Due to the fast expansion of the metropolitan area and limited land availability, the local government and airport authority will move all operations to the new Kunming Changshui International in early 2012. The new airport, being constructed at a cost of CNY23.09 billion (USD3.6 billion), will be the fourth largest in the country after Beijing, Shanghai Pudong and Guangzhou and will have four runways.

The airport is located 21km east of the city covering an area of 2297sqm within a 160sqkm airport economic zone. The airport is linked to Kunming by a new highway, and a light rail network link is also under construction. All operations will be transferred to the new airport by Jan-2012, and the old airport (Wujiaba) will be demolished.

Upon opening, the airport will have two 4000m runways and a partially solar powered 400,000sqm terminal capable of handling up to 27 million passengers p/a. The project forms part of the construction objectives of the 11th year plan. The main terminal, designed by architectural firm SOM with engineering firm Arup, with cover 548,300sqm to be the second largest terminal building in China.

The airport will also feature 84 parking bays, a 35,000sqm cargo facility and a 14,000sqm catering facility. The airport is expected to have capacity to handle 24 million passengers by 2015. This will increase to 38 million passengers p/a by 2020, with annual freight throughput of 95,000 tonnes and 300,000 aircraft movements by 2020. This will further increase to 58 million passengers and 1.7 million tonnes by 2030. By 2040, the airport will have capacity to handle 65 million passengers, 2.3 million tonnes of cargo and 456,000 aircraft movements. Construction commenced in 2009.

Kunming Changshui International Airport plans

Dublin Airport Authority (DAA) subsidiary Aer Rianta International (ARI) has signed a six-year contract with Yunnan Airport Group in China to operate 650sqm of retail space when the new airport opens. In its first move into China, the retailer will run 11 separate duty-paid stores selling branded skincare products, perfume and cosmetics, fashions items, accessories and other goods. DAA has signed a strategic collaboration agreement with the Yunnan Airport Group, which operates 11 airports in southwest China, saying it hopes the deal to operate outlets at Kunming Changshui will be the first of many partnerships between the two airport authorities.

Benefits from geographical position

Kunming has ambitious growth plans and the geography and economic growth to support this. The city of Kunming, the capital and largest city of Yunnan Province in Southwest China, benefits from its position near the border with Southeastern Asian countries, serving as a transportation hub in Southwest China. In recent years, Kunming's transport links to Southeast Asia and elsewhere, predominantly through its air links, have been steadily expanding, with direct services existing to all major Chinese cities, most major Southeast Asian cities and some major cities in Japan and South Korea. Kunming, which has a population of 4.8 million people, is the only major city in Yunnan province, and has been designated a special tourism centre and as such has a proliferation of high-rise buildings and luxury hotels.

Against this backdrop, Kunming is, like its peer airports, well placed to continue to serve as one of the nation's - and Asia's - largest airports. Its ambition to become China's fourth biggest hub will, however, face some strong competition from other powerhouse cities in the nation's broad and fast growing interior.

Background Information

Kunming Airport services over 20 airlines

Kunming Wujiaba International Airport services domestic and regional passenger and cargo services to over 20 airlines, including Air China, Beijing Capital Airlines, Chengdu Airlines, China Eastern Airlines, China Southern Airlines, China United Airlines, China West Air, Chongqing Airlines, Hainan Airlines, Juneyao Airlines, Kunming Airlines, Lucky Air, Okay Airways, Shandong Airlines, Shanghai Airlines, Shenzhen Airlines, Sichuan Airlines, Spring Airlines and Xiamen Airlines, and international airlines including Dragonair, Hong Kong Express, Lao Airlines, Malaysia Airlines, SilkAir, Thai Airways and Vietnam Airlines.

Domestic services for 94% of weekly scheduled seat capacity and 91.7% of scheduled ASKs. China Eastern Airlines is the dominant carrier at Kunming, with a 42% capacity (seats) share, followed by China Southern Airlines with a much lower 1.4% capacity share and Lucky Air with a 1.0% seat share.

Kunming Airport international vs domestic capacity (ASKs) share: 03-Oct-2011 to 09-Oct-2011

Kunming Airport international vs domestic capacity (seats) share: 03-Oct-2011 to 09-Oct-2011

Kunming Airport capacity (seats per week) by carrier: 03-Oct-2011 to 09-Oct-2011

International services are operated to 18 destinations in Asia Pacific and one in the Middle East, with Hong Kong the largest international market with 6706 weekly seats, followed by Bangkok (5032) and Singapore (2974). There are no direct services from Europe to Europe, the Americas or Africa.

Kunming Airport top 10 international routes (seats): 03-Oct-2011 to 09-Oct-2011