Reinstated Daily Sydney-Beijing flights Reflect Asia’s 50 Percent Share For QANTAS

After an eight-year gap, Australian airline QANTAS Airways has relaunched daily non-stop flights from Sydney to Beijing. The daily flights, which have been reinstated to coincide with the Chinese New Year, reflect a growing trend within the company to look to Asia at the expense of the airline’s European market, which has shrunk to 12 percent of its total international business from 30 percent in 2008. In contrast, Asia’s share of flights has jumped from 30 percent eight years ago to 50 percent.

The decision to reintroduce the flight path has been facilitated by a shift in market dynamics in recent years. The China-Australia Free Trade Agreement (ChAFTA), which came into force 20 December 2015, has provided a much anticipated boost to commerce between the two countries, as has the China-Australia Open Skies Agreement. Coupled with rapid growth in outbound Chinese tourism, China is expected to overtake New Zealand as Australia’s largest inbound tourism market by 2018. Additionally, UBS chief economist Scott Haslem has stated that based on trends, by 2019 arrivals to Australia will exceed departures for the first time since 2007. According to Haslem, ”the arrival boom was initially driven by Chinese tourists,” but now, the acceleration in arrivals has spilled over into private investment with the rapid construction of hotels and other accommodation. Given Chinese tourists typically take two to three flights when visiting Australia, new hotels will likely benefit from the surge – as will QANTAS with its 65 percent share of the domestic online market.

Certainly, QANTAS is hoping the newly reinstated Sydney-Beijing route will boost domestic business and add to the growing number of Chinese visitors to Australia. QANTAS are confident that Beijing’s high population is a large enough market to counter a loss in potential connecting flights due to the late arrival time of 22.40. On return flights to Sydney, the arrival time of 14.55 will give Chinese visitors time to connect to other domestic destinations and New Zealand, which will likely boost sales for QANTAS in other locations.

COTRI China Outbound Tourism Research Institute provides expert insights into the worldwide developments of China’s outbound tourism market. As Chinese outbound tourists are travelling to a large range of destinations, our publications cover a number of regions, providing detailed insights and analysing visitor behaviour.

With COTRI’s insights you can forge a successful business strategy built upon in-depth market expertise, comprehensive qualitative analysis and future projections. The Autumn 2016 Edition of the COTRI Market report features in-depth exploration of the developing trends in the field, supported by a wealth of qualitative and quantitative statistical research.

Sources: Reuters, Australian Aviation, ABC Australia, Daily Mail.

Photo: Flickr