Shanghai Pudong Airport

Integration headaches trigger 1Q loss at United as its revenue performance lags the industry

Persistently high fuel costs and challenges in a passenger system information technology cutover pushed United Airlines into a loss for 1Q2012 as its unit revenues lagged behind US legacy peers. Forecasts for the month of Apr-2012 show the lacklustre revenue performance continuing before heading into May-2012 when comparisons become increasingly difficult due to numerous fare increases pushed through in 2011. Despite the weak performance relative to the rest of the US airline industry, United remains confident it is taking the right steps through its merger with Continental Airlines to remain competitive over the long term. But for the moment the carrier is not disclosing a timetable of when it might close the unit revenue gap with its industry peers.

Special charges related to the passenger service system cutover in March and other integration expenses pushed United to a 1Q USD448 million loss compared with a loss of USD213 million the year prior. The cutover was the final step in combining United and Continental, and now that it is complete the Continental name has been retired.

China Eastern announces June-2012 Boston service as North Asia-North America traffic flows increase

After many years of waiting for Asian service, Boston Logan International Airport will see two Asian services this year after China Eastern Airlines announced it will open a daily Beijing-Shanghai route from 01-Jun-2012. The route launch follows recent CAAC approval. While Japan Airlines (JAL) will be the first Asian carrier to serve Boston, with a Boeing 787 service to commence on 22-Apr-2012, it is worth contemplating the speed with which China Eastern can launch its route compared to JAL. While JAL has had open access to Boston for many years, the Beijing-Boston route authority had been sitting idle since being granted to Hainan Airlines/Grand China Air in 2006. China Eastern’s approval for the route indicates Hainan has lost the route authority.

China Eastern is expected to take up the capacity in the short-term, reflecting the underlying strong potential of the China-US market, as well as the increased agility Chinese carriers have compared to fellow North Asian carriers in Japan, Korea and Taiwan.

China’s incredible airport growth

Chinese airports have grown at an incredible rate over the past ten years. The video below, taken from a recent conference presentation by CAPA Executive Chairman, Peter Harbison, demonstrates the dynamic change, as China's airports rise up the rankings.

The bubbles represent the relative size of the leading airports (in terms of millions of passengers p/a), while the horizontal scale represents annual growth. Beijing Airport has surged into second place behind Atlanta in a very short space of time. Shanghai Pudong and Hong Kong airports are also climbing.

(And note also Dubai Airport's incredible trajectory).

Beijing to overtake London as world’s largest aviation hub. Massive new airport planned

Congested Beijing is building fresh airport capacity that will see it become the world's largest aviation hub, leaving London - currently the world's busiest system of airports - and even ambitious Dubai in its wake. Beijing's new airport at Daxing south of the city could have up to nine runways and ultimate capacity to handle around 370,000 passengers per day, or a staggering 135 million passengers p/a. This would increase capacity at Beijing area airports to around 220 million p/a - almost a quarter of a billion passengers.

Top international routes in China and India. Shanghai Pudong and Delhi dominate

Shanghai Pudong Airport is China's leading international hub, reflecting its role as China's economic capital. Pudong has roughly 550,000 international seats per week, ranking it 22nd globally at present. Beijing Capital, with 470,000 international seats per week, ranks 27th globally, while Guangzhou (181,519 seats) is down in 85th place. Delhi has meanwhile become India's leading international gateway, with some 292,000 seats per week (ranking it 50th), ahead of Mumbai at just under 240,000 seats, ranking 63rd. But Dubai features heavily in the top 20 routes to/from India.