Chinese airlines rush into Europe as western carriers retreat
China’s three biggest state-owned airlines are rapidly expanding routes and capacity to Europe as their ability to fly over Russian airspace gives them a cost advantage over regional rivals. Western carriers have slashed direct flights to China, with Scandinavian Airlines, Lufthansa, British Airways and Virgin Atlantic all suspending some routes to the mainland in 2024, citing cost pressures from avoiding Russia. Moscow banned most European airlines from Russian airspace in 2022 in response to western sanctions imposed in the wake of President Vladimir Putin’s full-scale invasion of Ukraine, adding hours to flights to Asian destinations, including China, and driving up fuel bills. Chinese airlines, which are unaffected by the Russian airspace ban, have rushed to fill the gap, increasing capacity and offering cheaper tickets despite persistently reporting losses. “European carriers are just not competitive,” said David Yu, an aviation industry expert at New York University Shanghai. Passenger seat capacity, measured in available seat kilometres, between China and western Europe by the three main Chinese intercontinental carriers — Air China, China Eastern and China Southern — were 18% higher in October than in the same month in 2019, according to DBS equity research analyst Jason Sum. The three airlines’ scheduled flights to the UK, Spain and Italy have risen sharply, according to aviation consultancy Ishka, up between 25% and 45% in the first nine months of 2024 compared with 2019. They are also able to offer more competitive prices given the cost advantage of flying over Russia. The big three airlines’ fares are roughly 5 to 35% cheaper than those of European airlines for direct round-trip flights between China and western Europe, according to UBS analyst Eric Lin. European airlines have complained that Chinese carriers have an unfair advantage and are establishing a stranglehold on routes between the two regions.
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