Spring Airlines

Juneyao Airlines and Spring Airlines to use IPOs to grow fleets and expand the LCC model in China

In a country with a very small LCC penetration rate – 3.5% internationally and 6.1% domestically in FY2011 – Spring Airlines, and Juneyao Airlines to a lesser degree, have shown success is possible in China's heavily regulated market that favours the larger, state-owned ‘Big Three’ carriers. While challenges exist, the potential is huge for the nation's LCC market.

LCCs first entered the China market in 2005, with Spring Airlines, Juneyao and Okay Airways all launching operations with the low-cost model, although in less than eight months, Tianjin-based Okay Airways gave up the model. Spring Airlines in particular has had considerably success in carving out a niche, with the carrier maintaining industry-leading load factors and reporting consistent profitability, often while the state-owned carriers have reported losses. Spring and Juneyao are now looking towards their next phase of expansion and both are planning to launch IPOs in 2012 to help fund continued fleet and network expansion. 

Spring Airlines to enter lucrative Beijing-Shanghai route. 'Big Three' to launch LCC subsidiaries?

Spring Airlines, the Chinese LCC that celebrated its sixth anniversary on 02-Jul-2011, has received CAAC approval to commence services on the Beijing-Shanghai sector - China's busiest. In doing so, Spring becomes the first privately operated Chinese carrier to receive permission to serve the route, marking a key milestone for it and domestic aviation maturity in China. The carrier plans to launch a single daily service as early as the end of Sep-2011, building up its frequencies in the hotly contested market over time.

Spring Airlines slows expansion due to pilot shortage; strategy evolves

Spring Airlines, since its establishment in 2005, has defied the odds by growing rapidly and profitably in the heavily regulated Chinese market that favours the larger, state-owned carriers. While it has had success as the nation’s largest LCC, it has faced a number of challenges. The latest hurdle is a lack of pilots, which is forcing the carrier to curtail its growth and enact a change in strategy.

China’s second tier carriers reporting improved financial results in 2010

China’s second-tier carriers, Hainan Airlines, Shandong Airlines, Xiamen Airlines, Spring Airlines and Juneyao, all reported improved financial results in 2010, based on Chinese Accounting Standards. All of them are aiming to continue to expand their profitability and presence in the Chinese market.