Destination News - Destination, Rail, Road.(Brief article)

New York (AirGuide - Destination, Rail, Road News) May 24, 2009

Spring Airlines

Spring Airlines, hit hard by competition from high-speed rail, the most profitable Chinese LCC, is abandoning plans to open a second base in Zhengzhou to the north and shifting its attention south to Sanya in Hainan Province. Zhengzhou was attractive because it boasts China's only low-cost terminal, but Spring changed its mind owing to the presence of high-speed rail. Hainan, by contrast, "has rich tourism resources, which can guarantee high load factors as we have the support from our tourism agencies around the country," the spokesperson explained. He revealed that Sanya Fenghuang International plans to build a low-cost terminal for the carrier. Spring cancelled its Shanghai-Zhengzhou service in March, but the spokesperson said it is "still optimistic" about Zhenghzou and is considering adding frequencies. Recovery of the domestic market helped the LCC post a CNY15.9 million (USD 2.3 million) first-quarter profit, up 40 percent from the year-ago period. But it is cautious about the remainder of the year due to the swine flu scare and an increase in domestic fuel prices. Beijing raised the price by 11.5 percent to CNY4,450 per ton this week. May 22, 2009

ZZ AirGuide 090525

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