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2020-06-02 | All chapters

European Chamber Report Raises Concerns Over Sustainability of Operating Environment for Airlines in China

Beijing, 2nd June 2020 The European Union Chamber of Commerce in China (European Chamber) today released In for the Long Haul: Developing a Sustainable Operating Environment for Airlines in China. The report provides analysis on China’s operating environment and its impact on the sustainability of European airlines active in China.

China’s current system governing airlines pushes Chinese carriers to adopt short-term strategies that emphasise global market share rather than efficiency and profitability, which will damage the long-term viability of both Chinese and foreign airlines. The resulting lack of competition on long-haul routes in China, along with the continuous flow of non-essential financial support from local governments, is boosting capacity beyond demand.

The report outlines how this situation can be rectified through reforms to China’s slot allocation procedures, financial support practices, air traffic management system and bilateral aviation agreements, to bring China more in line with international norms. In the meantime, the report cautions European countries to fully understand the complexities of China’s market, particularly when renegotiating bilateral air traffic rights.

“Although the EU and China are working towards better alignment of their respective airline sectors, we are not there yet,” said Philippe Bardol, chair of the Aviation and Aerospace Working Group of the European Chamber. “EU-China dialogue on aviation must therefore continue, in the interests of creating a sustainable and competitive environment for airlines worldwide.”

Note on the COVID-19 Pandemic: This report was written based on the challenges experienced by European airlines prior to the start of the COVID-19 outbreak, which has caused significant global disruptions, especially in the aviation industry. The impact on the airline sector is expected to be severe, and this report does not aim to speculate about such an uncertain future. While the COVID-19 pandemic and its effects are mentioned throughout this report, the content primarily focusses on the structural and long-term challenges of the regulatory and operating environment for airlines in China's aviation sector, which are expected to endure after the coronavirus outbreak.

Download the report here.






“尽管欧盟和中国都在努力为如何推动双方航空产业的发展达成共识,但事实上实现这一目标还需要更多地努力,” 中国欧盟商会航空航天工作组主席白幻德先生表示。“因此,为了给全球航空业营造一个可持续的竞争环境,中欧双方必须要继续推动关于航空业的双边对话。”



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