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Hainan Airlines plans a new Tianjin base to secure routes to New York and Vancouver


Not blessed with an inherent position the way state-owned carriers are, Hainan Airlines has had to turn to improvisation and creativity. Fellow Beijing carrier Air China holds traffic rights for lucrative long haul routes so Hainan Airlines had to look for secondary markets like Boston and San Jose although there were blue chip wins like Chicago and Toronto, which Air China had neglected.

But the markets of New York and Vancouver have been too important to pass over. After proposing a number of ideas to serve New York, Hainan Airlines instead plans to open a long haul base in Tianjin to serve New York and Vancouver from Jun-2016. Beijing would of course have been preferable, but neighbouring Tianjin has potential. It is near Beijing with a high speed link into the city, and Hainan Airlines will have some feed from locally-based sister carrier Tianjin Airlines. The Tianjin long haul base follows primary long haul bases of Beijing and the recent opening of Shanghai Pudong.

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Understanding the Asia Pacific growth opportunities: Tony Fernandes explains the market

No-one doubts that Asia will become the dominant world aviation market over coming decades. North America and its airlines will necessarily be major beneficiaries of that expansion. For the time being however, the US-China market is only one third the size of US-UK’s and much lower yielding; Asia’s two biggest markets, China and Japan combined are still smaller than the UK market. But China-US capacity will double in the two years to Jul-2017, a trajectory that is likely to continue.
Meanwhile the nature of the Asian aviation markets has evolved greatly over the period of a decade. In Southeast Asia, nearly two thirds of all airline seats are on low-cost airlines, none of which existed a decade ago, implying a highly price sensitive underlying market.

In North Asia, this low-cost, price sensitive phenomenon is starting to take hold as well, albeit from a much lower market share. But it is growing fast, with many new entrants.

To understand fully how these forces will influence Asian consumer demand, we hear from Malaysia based Tony Fernandes, the man who sparked the LCC revolution in Asia and whose airline, AirAsia, has now carried 50 million passengers. In doing so, he has effectively deregulated international aviation across much of Asia.
The remarkable airline, with 9 operating entities, including cross border joint ventures in various countries, also includes three long-haul low-cost operators.

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