China's First Private Airlines Moves on Amidst Difficulties
Posted on: Thursday, 27 October 2005, 09:00 CDT
China's first private airlines moves on amidst difficulties
HARBIN, Oct. 26 (Xinhua) -- Despite survival pressures, Okay Airways, China's first private air company, will open a new passenger route soon, signaling it is still moving on amid difficulties.
The new route, starting on Oct. 30, will connect this capital city of the northeastern province of Heilongjiang and Tianjin Municipality where the company is based.
China's fledgling budget airline market is in sluggish progress because of tight grip from the government. Unlike their foreign counterparts enjoying free and booming business, Chinese private carriers like Okay face regulatory barriers against their efforts to open huge domestic market
State monopoly and uncompromising pricing system frustrate the country's budget airlines, leaving them little room of maneuvering. They can not make even basic decisions unless having regulators' permission, such as which airports and flight routes to use or when to purchase a plane, said Zhou Liqun, a professor with the School of Economics of the Tianjin-based Nankai University.
Okay's maiden flight in March was largely considered as a landmark that will possibly break the monopoly by state-owned airlines. But its low-cost strategy was questioned about how far it could go.
Following Okay's first move, a couple of private airlines have taken to the skies, such as United Eagle Airlines and Spring Airlines, while a lot of others are on the waiting list of approval.
Okay has announced earlier it will focus on cargo service in future to dodge fierce competition in passenger carrying. Liu Jieyin, present of Okay, said it has been in touch with the Korean Air Lines Co., Ltd. for cooperation, which is allegedly willing to take over 49 percent of the Chinese company's shares.
Source: Xinhua News Agency - CEIS
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