China Southern seeing rail services affecting more than half of its weekly services

China Southern Airlines Chairman, Si Xianmin, warned that emerging competition from China's expanding high-speed train services network is a "major challenge" for the country's airlines and would likely affect the airline business, due to lower prices offered by rail (Dow Jones/Bloomberg/Wall Street Journal, 28-Oct-2009). He stated the competition from high-speed trains is "already visible" and costing China Southern, Air China, China Eastern and other carriers market share on major routes where high-speed service is also available. According to Mr Si, traffic may fall by more than half on 518 of the carrier's weekly services, while 38 of the carrier's 160 domestic routes will compete directly with high-speed railway lines.

China Southern Airlines: "This will force us to expand overseas routes, on which we still have some competitive edge. It will eventually cause an impact on the global aviation industry… Airlines will lose all their current competitiveness, like saving time, What's more, the high-speed trains haven't reported any fatal accident in the past more than four decades. That's definitely a plus for passengers considering a trip by air or rail," Si Xianmin, Chairman. Source: Bloomberg, 28-Oct-2009.