China Eastern Airlines board secretary Luo Zhuping stated: "China Eastern was most affected when the Shanghai-Beijing high-speed railway opened, so it rebounded most when investors became concerned about the safety of bullet trains" (Shanghai Daily/Bloomberg, 26-Jul-2011). Domestic airlines are expected to regain their market shares from rail competition as air is seen as a safer option in the aftermath of a devastating train accident at Wenzhou City on 23-Jul-2011. However, Mr Lu said passengers in the long term will ultimately choose the means of travel with which they are most familiar. The incident is likely to have a short-term impact enabling airlines to regain market share lost to high-speed rail. The incident will also likely mean that, in the medium term, high-speed railways are unlikely to increase their operating speed. However, in the longer-term, the competitive balance will likely resume, once the safety issues are resolved. Meanwhile, China's government has ordered a two-month inspection of rail safety and fired three officials after 39 people were killed in the high-speed train crash. “We should have a thorough inspection and rectify any possible safety issues,” Rail Minister Sheng Guangzu said.
Chinese airlines regains market share from rail amid safety concerns
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Australia's view was progressive and detached from bygone days of national carrier interest; Chinese airlines hold 90% of the market to Australia. Elsewhere many governments still hold back on Chinese traffic right expansion so their local airlines can continue to grow. There are 15 Chinese airports that have nonstop flights to Australia with a total of 27 airport pairs – figures that should expand in 2017 as the market evolves further with the Virgin Australia-HNA partnership.
Aeroflot 6th freedom Part 2: China service is a strength for a SkyTeam member excluded from JVs
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