Airlines cut fares to Beijing
By Winny Wang |
June 28, 2011, Tuesday
|
Print Edition
Print Edition
Passengers are set to reap benefits of competition between planes and bullet trains on the Shanghai-Beijing route as airlines will cut ticket prices by as much as 65 percent.
The price of a one-way flight from Shanghai to Beijing will drop to as low as 400 yuan before surcharges from July 1, said travel agency Ctrip.com.
The lowest ticket price on the high-speed railway has been set at 410 yuan for the slower 250kph train.
Including airport fees and fuel surcharges, an air ticket will cost as little as 590 yuan, just 35 yuan more than a second-class ticket on the 300kph train.
"It's a surprise to get a 400 yuan air ticket from Shanghai to Beijing in a busy season. I will consider choosing airlines if the price keeps that low because planes are still much faster than trains," said Chen Lu, a 28-year-old human resources manager.
This month, discounts on most air tickets on the route were below 30 percent, and many tickets were sold at the 1,130 yuan full price.
But the airlines face stiff competition on what is one of the most profitable domestic routes with the start of the high-speed rail service on Thursday.
Punctuality is a key shortcoming affecting the airlines. In May, Shanghai-Beijing flights operated at 80 percent capacity on average, but punctuality was below 60 percent.
Last Thursday, stormy weather in Beijing delayed most flights and stranded a number of passengers at Beijing airport, further shaking passenger confidence in airlines.
"I will never choose airplanes to travel between Shanghai and Beijing as trains are more punctual and less affected by weather and traffic control," Eric Yang, a 30-year-old employee at a freight forwarding company.
Ma Xulun, general manager of Shanghai-based China Eastern Airlines, said the carrier will improve punctuality and service to compete with the high-speed rail service. He expected a loss of 15 to 20 percent of passengers from domestic airlines initially. But after six months, passenger volume would recover to the same level as before.
Some carriers are to adjust capacity on the route, such as replacing A330 jets, which can carry 300 passengers, with 180-seat A320 jets.
"About 80 percent of airplanes on the route are wide-body planes. Carriers can replace them with smaller ones to weather the impact from high-speed railways temporarily. An 80 percent load factor can secure a stable ticket price for airlines," said Wu Li, an analyst at Essence Securities.
However, besides competition, airlines are also looking to cooperate with the railways for their mutual benefit.
Railway officials have signed an agreement with China Eastern Airlines to integrate services, allowing passengers booking airline tickets to and from Tokyo, Seoul, Taipei and Hong Kong, to also book train tickets between Shanghai and cities in the Yangtze River Delta Region and get the train tickets at the Hongqiao station.
The price of a one-way flight from Shanghai to Beijing will drop to as low as 400 yuan before surcharges from July 1, said travel agency Ctrip.com.
The lowest ticket price on the high-speed railway has been set at 410 yuan for the slower 250kph train.
Including airport fees and fuel surcharges, an air ticket will cost as little as 590 yuan, just 35 yuan more than a second-class ticket on the 300kph train.
"It's a surprise to get a 400 yuan air ticket from Shanghai to Beijing in a busy season. I will consider choosing airlines if the price keeps that low because planes are still much faster than trains," said Chen Lu, a 28-year-old human resources manager.
This month, discounts on most air tickets on the route were below 30 percent, and many tickets were sold at the 1,130 yuan full price.
But the airlines face stiff competition on what is one of the most profitable domestic routes with the start of the high-speed rail service on Thursday.
Punctuality is a key shortcoming affecting the airlines. In May, Shanghai-Beijing flights operated at 80 percent capacity on average, but punctuality was below 60 percent.
Last Thursday, stormy weather in Beijing delayed most flights and stranded a number of passengers at Beijing airport, further shaking passenger confidence in airlines.
"I will never choose airplanes to travel between Shanghai and Beijing as trains are more punctual and less affected by weather and traffic control," Eric Yang, a 30-year-old employee at a freight forwarding company.
Ma Xulun, general manager of Shanghai-based China Eastern Airlines, said the carrier will improve punctuality and service to compete with the high-speed rail service. He expected a loss of 15 to 20 percent of passengers from domestic airlines initially. But after six months, passenger volume would recover to the same level as before.
Some carriers are to adjust capacity on the route, such as replacing A330 jets, which can carry 300 passengers, with 180-seat A320 jets.
"About 80 percent of airplanes on the route are wide-body planes. Carriers can replace them with smaller ones to weather the impact from high-speed railways temporarily. An 80 percent load factor can secure a stable ticket price for airlines," said Wu Li, an analyst at Essence Securities.
However, besides competition, airlines are also looking to cooperate with the railways for their mutual benefit.
Railway officials have signed an agreement with China Eastern Airlines to integrate services, allowing passengers booking airline tickets to and from Tokyo, Seoul, Taipei and Hong Kong, to also book train tickets between Shanghai and cities in the Yangtze River Delta Region and get the train tickets at the Hongqiao station.
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