Hainan Airlines to launch three new airlines as part of portfolio strategy

Hainan Airlines, China's largest private carrier, is planning to launch three new airlines in the domestic Chinese market, continuing its portfolio strategy. While China's other big carriers have their own partially or wholly-owned subsidiaries as well, only Air China has shown recent interest in high growth through this approach.

While different brands and management teams mean synergies are diluted, many of these carriers receive equity from their hub's regional government, which want a local airline of their own.

Hainan differs from competitors in also having an international subsidiary strategy, although this approach is still only vaguely defined. No specific growth is planned for the future, and Hainan's proposals to launch a domestic carrier in Saudi Arabia and to acquire the Philippines' Zest Airways have fallen through.

This report reviews the establishment of Urumqi Airlines, Heilongjiang Airlines and Fuzhou Airlines - each working towards a hub strategy.