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3-Jul-2014 10:28 AM

China United Airlines officially transforms into LCC

China Eastern Airlines stated (02-Jul-2014) China United Airlines officially transformed into a LCC, becoming the first of China's big three state-owned carriers to offer both full service and LCC services, according to China Eastern Airlines Weibo page. The LCC is expected to become China's largest LCC in the future. China United, currently based at Beijing Nanyuan Airport, will move all its operations to the New Beijing Airport once it is operational in 2018. The LCC will compete with Spring Airlines and Hainan Airlines Group's West Air. Chinese carriers are encouraged by CAAC which in 2013 lifted a six-year ban on the establishment of new airlines as well as incentives to foster the development of LCCs in the nation, according to company secretary James Wang and as reported by Xinhua, Apple Daily and Yicai. He said: "We believe the low cost carrier market has enormous growth potential in China given its low penetration rate," adding "on a global basis, low cost carrier development in China is the slowest." Chairman Liu Shaoyong also said the carrier expects to see "explosive growth of LCCs, especially in China." Meanwhile, commenting on China Eastern's choice to transform China United into a LCC, China United chairman Tang Bing said it was partly because the carrier operates a fleet of all-Boeing 737s.

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