Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

China forges ahead with airport construction binge, despite signs of slowing air traffic growth

China forges ahead with airport construction binge, despite signs of slowing air traffic growth

China plans to build an additional 215 airports by 2035 in an effort to turn its aviation industry into a strategic part of its trillion dollar economy. But the sector appears to be cooling as growth in passenger and cargo volumes has slipped over the past three years

China is pressing ahead with plans to build an average of 14 airports every year over the next 15 years, despite passenger and cargo growth showing signs of slowing after a period of rapid expansion.

Already equipped with some of the world’s largest airports, the Civil Aviation Administration of China (CAAC) wants to add another 215 to reach a target of 450 by 2035, helping to turn China’s aviation industry into a strategic part of its trillion-dollar economy.

In the short-term, the airport investment plan – which was first outlined in 2007 – will also help stimulate growth, as concerns grow that China’s economy will shrink in the first quarter of 2020 as it is battered by the coronavirus outbreak.

China’s aviation sector is on track to surpass the United States and become the world’s largest in 2024, according to the International Air Transport Association.

Between 2014 and 2019, China spent 486.32 billion yuan (US$70 billion) on ground infrastructure and upgrades of airports and air traffic controlling systems, helping fuel its ambitions to become an international aviation hub.

The CAAC budgeted 85 billion yuan (US$12.2 billion) for fixed asset aviation investment in 2019 and 100 billion (US$14.4 billion) this year, while it spent 85.79 billion yuan in 2018.

But after years of fast growth in the sector, there are indications that the pace of expansion may be cooling.

The growth of annual passenger and cargo volumes in China has slowed over the past three years, increasing 7.9 per cent to 660 million in 2019, compared with 10.9 per cent in 2018 and 13 per cent in 2017, according to data from the CAAC.



Overall cargo volume last year was 75.26 billion tonnes, a mere 1.9 per cent rise from a year earlier, and well below annual growth of 4.6 per cent in 2018 and 5.7 per cent in 2017, CAAC data showed.

Passenger growth at Shanghai Pudong International Airport, one of the country’s aviation hubs, has been declining since 2015, falling to 2.8 per cent last year – or some 76.09 million passengers – its slowest rate in eight years.

Guo Yufeng, chief executive of WinSale Airport and Q&A Consulting, said China’s airport construction plan was focused on long-term demand as well as the development of local economies.

“With demand rising, more airlines and airports are needed,” said Guo. “Some international routes between major global cities are always profitable, like between Shanghai and New York. Some are bound to make a loss in the short term.

“But local governments have an incentive to keep the route going with subsidies for the sake of general economic development and trade growth, especially in second tier cities.”

China’s international routes have been losing money to the tune of billions of yuan a year over the past three years, with losses in 2018 hitting 21.9 billion yuan (US$3.1 billion), Li Jun, chairman of the China Air Transport Association, said at a forum last year.
And it is not just international flights, either, with some domestic carriers suffering due to high operating costs and low passenger volumes.

Professor Li Guijin, from the Civil Aviation Management Institute of China, told Chinese media last year that the total share of regional flights in China’s aviation market had dropped from 16 per cent to about 5 per cent over the past 18 years.




While China’s aviation market has taken a hammering this year as the coronavirus curtails worldwide travel, approvals for new airports and expansions have pressed on.

In the past two months, China’s state planning body, the National Development and Reform Commission (NDRC), approved three new airport projects, including a third runway at Shenzhen airport, worth a total of 91 billion yuan (US$13.1 billion).

Construction of 81 stalled airport projects, meanwhile, has resumed following an extended Lunar New Year holiday due to the virus outbreak, and the CAAC was working hard to start a new batch, local media have reported.

The government in Shandong province also said last week it would hire local staff and help transport migrant workers back from their hometowns to kick-start delayed airport projects.

More than 70 countries and territories have slapped travel restrictions or tightened visa requirements for travellers from China due to the coronavirus outbreak, severely denting China’s share of global air traffic and prompting Beijing to pay domestic and foreign airlines to restore services.

The CAAC announced new measures to support airlines and airports on Monday, including reducing airport and air control fees.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
The Personality Rights Challenge in India’s AI Era
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Study Finds No Safe Level of Alcohol for Dementia Risk
Trump Says Ukraine Can Fully Restore Borders with NATO Backing
Europe Signals Stronger Support for Taiwan at Major Taipei Defence Show
Germany Weighs Excluding France from Key European Fighter Jet Programme
Cyberattack Disrupts Check-in and Boarding Systems at Major European Airports
Björn Borg Breaks Silence: Memoir Reveals Addiction, Shame and Cancer Battle
When Extremism Hijacks Idealism: How the Baader-Meinhof Gang Emerged and Fell
JWST Data Brings TRAPPIST-1e Closer to Earth-Like Habitability
Trump Orders $100,000 Fee on H-1B Visas and Launches ‘Gold Card’ Immigration Pathway
France’s Looming Budget Crisis and Political Fracture Raise Fears of Becoming Europe’s “Sick Man”
Three Russian MiG-31 Jets Breach Estonian Airspace in ‘Unprecedentedly Brazen’ NATO Incident
European manufacturers against ban on polluting cars: "The industry may collapse"
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
U.S. and China Agree on Framework to Shift TikTok to American Ownership
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
The New Life of Novak Djokovic
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
France Faces New Political Crisis, again, as Prime Minister Bayrou Pushed Out
Nayib Bukele Points Out Belgian Hypocrisy as Brussels Considers Sending Army into the Streets
France, at an Impasse, Heads Toward Another Government Collapse
×