| Spring Airlines: See Annual Revenue of More than CNY 20 Million |
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Spring Airlines has built up its own profitable mode in an exploration of the past year. Currently it is planning to raise CNY 3 billion, together with its present funds, to purchase 10 more Airbus A320s. The plan has interested many investment firms from China or abroad to participate in. Meanwhile, the company's expansion is underway, seeking a secondary base out of Shanghai Hongqiao Airport which can no longer meet its booming demands. |
| East Star Airlines: Not Bad |
| Since its launch on May 19 this year, East Star, who was enduring hostile eyes from other airlines, has operated scheduled flights to 9 cities such as Guangzhou, Shenzhen, Haikou, Nanjing, Shenyang, hangzhou, Xi'an, Guilin and Changde. In the half-year operation, it flew 255000 passengers with the load factor of 82.6 percent, and recorded sales revenue of CNY 135 million and net profit CNY 6.3 million. |
| Okay Airways: Nightmare Ends Up |
| The first private airline in China has been struggling with loss all the way since its launch. To end the nightmare it joined Junyao Group Co. by share holding. Then its life changed immediately. On Nov. 23, Okay Airways earned it all-cargo freighter operating license, and it gains over CNY 5 million on passenger traffic in July and August. |
| China Express Airlines: Likely to Gain |
| China Express Airlines, specializing in regional air transport, had a perfect beginning with extremely high load factor on its regional flights in Guizhou province, which seemed to be a sign of something. |
| Eagle Airlines: No Longer "Private" |
| Eagle airlines, who had been undergoing financial crisis, finally grabbed the hand of Sichuan Airline, a state-owned carrier, which bought 20 percent stake in Eagle Air with CNY 20 million. |
| Jixiang Airline: Full of Confidence |
| Shanghai-based Jixiang Airline, a new player, launched on September 25 this year, is confident of its perspective, "we have made the financial simulation for the following 5 years, taking all possible factors like exchange rate and oil price into account. Gain in a year? No problem." |
| China's private airlines are facing extra barriers from a series of out-of-date policies. The restriction on pilots move result in shortage of qualified pilots in private airlines while excess pilots in state-owned ones. The difficulty in route application and over concentrated control on aircraft purchase are also stranding the private players.[Details] |
| Uneven Resource Allocation |
| As new players China's private airlines found themselves facing a cruel reality that main profitable routs have been carved up and little left for them. An industry official said, "The market for private airlines has already been fixed up, that is regional transport, and there's no way to run beyond that." |
| Assaults from Vested Interests Holders |
| East Star Airlines has experienced such strangulation by an interest alliance of state-owned airlines only two weeks after its launch. Spring Airlines' cheap fare just persisted less than a month under pressure. Okay Airways would never forget the resistance before its maiden voyage. All these remind private carriers the uneven game they are playing. |
| In august, the establishing Kunlun Airlines announced to withdraw its application from CAAC, and became the first one that failed to fulfill its establishment as a private carrier. The abort was reportedly due to funds problems. Lack of funds, has been a common issue for private carriers which previously led Okay Airways joined Junyao Group, Eagle Airline sued by investors and had to seek shelter of Sichuan Airlines. |
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| [Editor's Notes] In 2005, the "Provisions on Domestic Investments into the Civil Aviation Industry" opened sky for private investors and the influx of non-government capital to the civil aviation industry has resulted in the establishment of 14 private airline companies in China. Now, when a year has passed, how are they going? |
 Strategy Differs but Tactics Similar |
Different strategies led to operation diversities. Someone eyes on the resource of business travelers, someone is committed to offering cheap service and someone specializes in cargo.
However, the operation modes for private carriers in China are almost the same: a) online distribution b) raise aircraft utilization c) maintain less staff d) cut any unnecessary costs |
| To be or Not to be, Orientation Decided |
| For China's private airlines what is the key that decides success or failure? The answer is market orientation. Successful airlines typically offer services with their own personality and will hold on until gain identification from customers, while losers forget orientation, though they may be successful in cost control and routes expansion, they do not have some mark to be identified, and will gradually be ignored. |
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