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China Eastern Airlines

Shanghai-based China Eastern Airlines is one of China's 'big three' state-owned airlines, with hubs at Shanghai's Pudong and Hongqiao airports, as well as Kunming Airport in southwest China. The airline operates a fleet of Airbus, Boeing, Embraer and Bombardier aircraft to support an extensive network, serving over 350 domestic routes and 40 international destinations, including cities in Australia, Europe, Korea, Japan, North America and Southeast Asia. China Eastern merged with Shanghai Airlines in 2010 and joined China Southern in the SkyTeam Alliance in Jun-2011.

Location of China Eastern Airlines main hub (Shanghai Pudong Airport)

China Eastern Airlines share price


 
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China airline growth: 57% international surge while domestic holds up and Hong Kong/Macau fall

30-May-2015 9:03 AM

As questions reverberate about China's economy and slowing growth, what are the impacts to Chinese aviation, home to the world's second-largest domestic market?

The good news is 1Q2015 traffic from China's airlines is comfortably robust, increasing 13% and surpassing 100 million passengers for the first time. Domestic growth remained at 11%, with Chinese airlines carrying an additional 9 million domestic passengers in 1Q2015 compared to 1Q2014 – equivalent to an additional 656 737 flights a day.

International growth has picked up giant steam, surging 57% in 1Q2015 – equivalent to an additional 64 A380 flights a day. But overall international traffic remains small for Chinese airlines, accounting for only about 7% of total carriage – the same as in 2008 but higher than more recent years. Regional growth has slowed to 5% as Hong Kong and Macau are not as attractive as they used to be.

More worryingly for Taiwan, that market is starting to show a contraction in Chinese visitors, perhaps as they head to seemingly more exotic regional Asian points like Japan, Korea and Thailand. Those three countries will attract the highest growth from Chinese airlines in summer 2015.

Sichuan Airlines becomes China's 7th airline to have 100 aircraft. Next 10 years: another 100

21-May-2015 12:34 PM

Sichuan Airlines is due to take delivery of an Airbus A320 family aircraft on 22-May-2015, giving the Chengdu-based carrier 100 aircraft. Sichuan becomes the seventh airline in China to have a fleet of 100 or more aircraft. Globally Sichuan will be the world's 50th largest airline by fleet size. Sichuan intends to take another 100 aircraft over the next decade.

Sichuan's hinterland is mostly in China's west, from Xi'an and Kunming to Chengdu and Chonqging, although it also has a large presence along China's eastern seaboard. Sichuan carried just under 20 million passengers in 2014, almost all domestic.International flying, which accounts for 9% of Sichuan's seats in May-2015, is mostly around Northeast and Southeast Asia but limited long-haul links extend to Australia, Moscow and Vancouver.

All of China's Big Three airlines – Air China, China Eastern and China Southern – have a direct or indirect stake in Sichuan Airlines, creating competing interests in China's booming west.

Chinese airlines overtake US carriers across the Pacific. The big dilemma: US-China open skies?

4-May-2015 1:02 PM

There were two prominent themes at CAPA's Americas Aviation Summit in Las Vegas on 27/28 Apr-2015. First was the intensity with which some US airlines fear competing with Gulf carriers, which operate under open skies regimes to the US.

Second - and of more lasting importance - was how important North America, and especially the United States, will be to international growth from Chinese airlines. Air China VP and GM North America Dr Zhihang Chi called China-US services "low-hanging fruit" while Hainan Airlines VP Hou Wei said North America was the biggest opportunity for Hainan, which recently announced its intent to take 30 787-9s, mostly for North American service. Although the two themes may seem separate, they are becoming interwoven.

For years the US has wanted open skies, while China, whose airlines were smaller than America's, wanted gradual expansion. But now the tables are turning. In summer 2015 Chinese airlines for the first time in history will be larger than their US counterparts between the US and China. The rapid change of pace and with more growth clearly to come, is giving US airlines cause to reflect on their experience with Gulf carriers.

As a new round of bilateral negotiations approaches, US airlines may no longer favour open skies with China, hoping to keep the liberalisation genie in the bottle and prevent another influx of foreign carrier capacity. Consumers, tourism bodies and the US government may have another fight looming.

China Eastern's LCC China United is expected to start international flying, challenging Air China

22-Apr-2015 11:51 AM

China Eastern Airlines is taking the lead amongst the country's state-owned carriers in developing an LCC presence. This follows Beijing's embrace and active promotion of LCCs, which it sees as spearheading new growth and being in line with the country's increasing austerity and efficiency targets. China Eastern has converted its subsidiary China United Airlines, based at the smaller Beijing airport of Nanyuan.

China United only flies domestically, and mostly to secondary cities, but in Jan-2015 applied to regulator CAAC to expand its business licence to international services. China United is expected to be given the right to fly internationally from its Beijing home but also Shenzhen.

Shenzhen's international development has been stunted – possibly due to lobbying from Air China partner Cathay Pacific, which feeds on the Shenzhen market – and local carrier Shenzhen Airlines has a minimal international presence. Shenzhen Airlines is majority owned by Air China, meaning China United's international expansion could eventually challenge the Air China group at multiple levels. With time there will also be an impact to the Hong Kong market, although crossing the border is still far from seamless.

Delta Air Lines' Shanghai hub plans: replicating the Amsterdam-KLM relationship will be difficult

20-Apr-2015 12:31 PM

At the same time as Delta Air Lines and its pilots take the lead in anti-Gulf rhetoric and ask for traffic rights to be withdrawn, brief comments by CEO Richard Anderson suggest Delta is considering establishing a hub in Shanghai. 

A Shanghai presence would be a logical move for Delta, but establishing a hub will require the blessing of local partner China Eastern.

This Shanghai-China Eastern potential visually has similar building blocks to Delta's existing Amsterdam-KLM partnership; but the same outcome is far from guaranteed.

In the long term, Delta will need China Eastern more than China Eastern will need Delta. In this case the negotiating power does not rest in Atlanta. And, although both are SkyTeam members, China Eastern - and the other Chinese majors - have demonstrated considerable pragmatism in their partnership relations. Star Alliance's Air China for example holds a substantial minority share in oneworld's Cathay Pacific.

Hainan Airlines order for 30 787-9s underscores trans-pac growth. Partnerships will need to increase

30-Mar-2015 5:45 PM

Hainan Airlines' decision to order 30 787-9s for delivery by 2021 will see Hainan narrow the international/widebody gap it has with China's three main state-owned airlines. Hainan has the fourth most number of passenger widebody aircraft in China (29) after Air China (83), China Eastern (59) and China Southern (57). The 787-9s, which supplement an earlier order for 10 smaller 787-8s, will take Hainan's disclosed commitment for future widebody aircraft to 37, ahead of Air China (32), China Eastern (20) and China Southern (13).

Many or even most of the 787-9s can be expected to be used on trans-pacific routes, Hainan's core long-haul segment and a market that is growing rapidly. The larger 787-9 not only allows Hainan to carry more passengers but decreases unit costs, critical as Hainan still needs to build yield strength. The order is still probably conservative and Hainan could have more growth – if Beijing allowed.

With more long-haul growth, Hainan will need to turn to partnerships. After Emirates and Alaska Airlines, Hainan is the largest full-service airline not part of a global alliance.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.

This content is exclusively for CAPA Membership Subscribers

CAPA Membership gives you the latest aviation news and alerts, access to CAPA articles, reports, and our leading aviation data with optional premium add-ons.