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China struggling to meet soaring aviation demand, analysts say

China struggling to meet soaring aviation demand, analysts say

Beijing's enormous new airport terminal is the most potent symbol of a frantic aviation boom in China, but the infrastructure surge is still struggling to match soaring demand, analysts say.
While airport expansions elsewhere around the world are often mired in planning disputes, China is aiming to build nearly 100 new airports by 2020 at a cost of more than US$60 billion, including the world's highest in Tibet.
The most ambitious of these is the US$2.7 billion Terminal Three at Beijing Capital Airport - it is the size of 170 soccer fields - which will open its doors to passengers this morning.
For the long-suffering passengers who have had to deal with frustrating delays, over-priced food and long immigration queues, the new terminal will offer welcome relief.
Yet in Beijing, like the rest of the country, the upgrade may simply not be enough.
"China is taking delivery of a new plane every three days," said Jim Eckes, Hong Kong-based managing director of consultancy Indoswiss Aviation.
"With that kind of growth at the moment and with the Olympics coming up, the new terminal is just what Beijing needs, but its capacity will be met in a couple of years.
"The majority of airports in China are under tremendous pressure to get their infrastructure up to standard so they can handle the increase in passengers and planes."
In parallel with the nation's double-digit economic growth, the Beijing airport handled 48 million passengers last year, way above its capacity of 35 million, according to official statistics.
Beijing's hosting of the Olympics in August are expected to boost this number by a further third in 2008, and officials say the new dragon-shaped terminal will be able to meet this with an annual capacity of 76 million.
Adrian Lowe, an aviation analyst at CLSA brokerage in Hong Kong, agreed that China's massive aviation infrastructure development was just not enough to keep up with the demand.
"They do not have the planes, they do not have the airports, they do not have the pilots," he said, referring to forecasts by Boeing that aviation traffic in China would grow at eight percent for the next 20 years.
Civil aviation traffic grew 16 percent last year to 185 million passenger trips, and is expected to increase to 210 million in 2008, according to China's General Administration of Civil Aviation.
And while the US$60 billion airport expansion plan sounds massive, Eckes pointed out that China currently had just 150 airports, compared with around 120 in the U.S. state of Ohio alone.
Tom Ballantyne, chief correspondent at trade magazine Orient Aviation in Australia, also pointed to the problem of most airport traffic being centered on three of the nation's biggest cities.
"The authorities have put a lot of effort into the big expansion of new airports, but the main problem in China is everyone wants to fly into Shanghai, Beijing and Guangzhou," he said.
The government is now offering subsidies to airlines to open routes to the less developed western region to try and address the balance, he said.
Aviation authorities have been candid about the problems.
They cut flights in and out of Beijing last year and have threatened airlines who fail to supply enough cockpit crew with a ban on new routes and aircraft.
"The structure is outstandingly unbalanced, safety risks continue to rise and economic returns remain low," state aviation chief Li Jiaxiang was quoted as saying earlier this year.


Updated : 2021-03-02 01:11 GMT+08:00