When design plans were first announced for Kunming Changshui International Airport in 2006, expectations were high that the 33.5 billion yuan facility would help transform the Spring City into an international tourist hub. Those aspirations appear to be coming closer to reality as several airlines are vying for new Kunming routes.
The largest company looking to expand its presence in Yunnan is China Southern Airlines (CSA), which currently has only four aircraft devoted to the province. It has recently established a branch company in Kunming which will explore how best to capitalize on Yunnan's rapidly increasing aviation sector. Negotiations between CSA and Changshui authorities are ongoing, but "basic resolutions have been agreed upon" according to an unnamed source quoted in local media reports.
Discussions between the two parties may hinge on whether the carrier is willing to designate Kunming a 'focus city', of which CSA currently has 14 — the closest to Kunming being Chongqing. Any agreed upon framework must also garner the approval of the country's airspace authority, the Civil Aviation Administration of China (CAAC).
China Southern is Asia's largest airline and operates a fleet of some 500 aircraft. In 2012 the company accommodated 86.5 million passengers. Despite such reach, the airline currently holds less than twelve percent market share of Kunming air traffic, trailing both China Eastern Airlines and Lucky Air. Any expanded presence in Yunnan would presumably link passengers to CSA's mammoth worldwide network, which includes stops in 193 cities in 35 countries.
China Eastern is also increasing its presence in the province, adding nine planes to its Yunnan fleet earlier this year. The move was seen by industry experts as a counter to both Lucky and Xiamen airlines announcing their intentions to separately increase the number and frequency of flights into Yunnan.
Ruili Airlines, a private start-up company just recently approved by CAAC, is in the process of purchasing a small fleet of mid-sized Boeing 737s. The regional carrier is expected to go into operation in the spring of 2014.
Furious expansion by multiple carriers into Yunnan is expected to dilute the market considerably. Ostensibly this could force a pricing war as companies fight for the attention of travelers and lower the cost of air travel into and out of the province in the process.
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