Southern comfort for Airbus

In a world first, Chinese airline will use A380 on domestic routes

Southern comfort for Airbus

Soon taking off from Guangzhou

Four years after the A380 first began to fly commercially, a Chinese carrier is about to take receipt of its first Airbus double-decker.

China Southern announced that it would buy the A380 back in 2005, with the original (and somewhat ambitious goal) of operating the aircraft in time for the Beijing Olympics three years ago.

Delays in delivery put paid to that schedule and maiden flights begin later this month, with a series of “A380 experience flights” between Beijing and Guangzhou (the airline’s home hub), and Shanghai and Beijing.

This is a puzzling debut for some, given that the A380 was originally designed for long-haul travel between congested international hubs, and not for flights within borders.

Early operators Qantas and Emirates also put their aircraft straight to work on long-haul trips, with the operating economics looking strained by shorter flight times.

However, Korean Air has been deploying the A380 for regional operations, and Emirates has been using it on shorter trips too, including the three-hour hop between Dubai and Jeddah.

Another reason for the cautious introduction of the new aircraft is that China Southern will take possession of a single A380 from Airbus on October 15 (it has five on order). In the event of a technical glitch at an airport overseas, it could face problems sending a single replacement large enough to retrieve all the passengers.

The airline will also want to ease carefully into A380 operations, with the shorter sectors allowing more pilots and cabin crew to gain flight experience.

Plus it will take time for the home hub in Guangzhou to adapt, with taxiways and runways now extended, and handling facilities reshaped to absorb the dual-height bridge needed to board passengers.

As of last month, the A380 was cleared to operate to over 130 airports worldwide.

But another of the challenges for China Southern being discussed in the domestic media is more of a commercial one: filling the aircraft with passengers.

As Digital Business Times points out, China Southern has the largest fleet of the Chinese carriers. But it is heavily reliant on its domestic business, deriving just a fifth of its revenues from international flights (compared to 50% for leader Air China). Its international passenger volume was up to 3.9 million in the first eight months of this year. But that trailed dramatically the 48.5 million passengers it carried domestically in the same period.

The A380 strategy is a huge risk, agrees 21CN Business Herald, as China Southern does much better domestically than on international routes. But the plan is now to double capacity on international routes, with the new A380s spearheading the expansion. ”We need to increase our efforts on routes to Europe and the US,” admitted a source from the airline. “The A380 will give us the chance to ‘stand up’.”

Will that work? As China Business points out, the seat configuration chosen for the first A380 in the fleet is not the luxury layout preferred by some of the aircraft’s other operators, offering 8 seats in first class, 70 in business and 428 in economy. Airlines traditionally earn more carrying premium passengers than those in cheaper seats, leading the newspaper to query whether China Southern will make sufficient margin to cover its operating costs.

But that viewpoint looks a little out of date. Although the early A380s entered service configured more with a focus on the premium traveller, more recent arrivals have often been kitted out with an increased quota of economy class seats.

China Southern’s layout looks much more the norm than it would have done four years ago, and sounds like being a whole lot less crowded than trips with Air Austral, a carrier based in the French island of Reunion, which is planning an all-economy layout of “around 840” seats. Once final approvals are received from regulators, Paris and New York look like being the first international destinations to welcome A380 arrivals from the airline’s Guangzhou hub.

© ChinTell Ltd. All rights reserved.

Sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.