European Carriers Slash Flights to China
In recent years, European airlines have significantly reduced their presence in China, with Finnair leading the charge. The Finnish airline saw its direct flights from Helsinki to China plummet from 42 to just three. This trend has been mirrored by other prominent carriers, including Virgin Atlantic and SAS Scandinavian Airlines, which have entirely ceased operations in China in 2024. Meanwhile, airlines such as British Airways, Lufthansa, and LOT Polish Airlines have also chosen to “quietly quit” numerous Chinese destinations, as noted by the aviation news platform Skift.
Impact of Russian Airspace Closure
The closure of Russian airspace following the Ukraine conflict has been a key factor in the reduction of flights. After Russia invaded Ukraine in February 2022, European leaders swiftly instituted a ban on Russian flights, leading to retaliation from Moscow. As a result, airlines were forced to adopt longer routes to Asia, which dramatically increased operational costs. Specifically, fuel expenses, which comprise about 25% of an airline’s operating costs, soared due to longer flight durations.
Increased Flight Times and Crew Costs
The extended flight times have posed additional challenges for airlines operating between Europe and China. Finnair’s travel time between Helsinki and Shanghai increased from approximately 8.5 hours to over 11.5 hours. Christine Rovelli, Finnair’s Chief Revenue Officer, explained that the closure of Russian airspace has caused flight durations to lengthen by 10% to 40%, depending on the destination. Consequently, this situation has impelled airlines to reevaluate their route networks and focus more on westbound routes while still maintaining a presence in essential Asian markets.
Longstanding Routes Proved Unsustainable
British Airways, a historic player in the route from London Heathrow to Beijing, announced a halt in this service after 44 years. Though Shanghai and Hong Kong routes remain, flight frequency to Hong Kong is set to decline, with the airline substituting its larger Airbus A380 with a smaller Boeing 787-9. Lufthansa is also scrutinizing its operations, particularly its daily Frankfurt to Beijing service, and LOT Polish Airlines has prematurely canceled its Warsaw to Beijing flights for the winter season.
Chinese Airlines Thrive Amid Challenges
In stark contrast, Chinese airlines continue to capitalize on their unencumbered access to Russian airspace, allowing them to operate without the costly detours plaguing their European counterparts. Consequently, Chinese carriers will account for an impressive 82% of all flights between China and Europe this winter. With 18 new routes launching, all from Chinese airlines, the landscape has tilting heavily in their favor. Wouter Vermeulen, the Air France-KLM general manager for Greater China, lamented the “lack of a level playing field,” highlighting the competitive disadvantage faced by European carriers.
Market Dynamics and Changing Demand
Yet, the situation goes beyond just airspace access. Some European airlines have redirected resources towards other regions in Asia, as evidenced by Finnair’s increased flights to Thailand. Additionally, Qantas, the Australian national airline, recently canceled its Sydney-Shanghai route despite no restrictions from Russian airspace, citing low occupancy rates. This situation suggests that less favorable market conditions and strained economic relations between China and the West are contributing factors behind the flight cancellations.
Declining International Interest in China
A significant decrease in demand compounds these challenges. China has seen only 17.25 million foreign visitors as of July 2024, a stark decline from the 49.1 million who arrived in 2019 before the pandemic. This dip in tourist numbers has curbed both outbound travel from China and the influx of international visitors eager to explore the country.
Holding On for Future Opportunities
Despite the difficult circumstances, most European airlines are not entirely abandoning the Chinese market. They seem intent on retaining their positions on the route map, hopeful for a market rebound. As international travel resumes and relations improve, there remains confidence that opportunities will arise, allowing European carriers to reestablish their foothold in China once again.
SOURCE: Ref Image from Finnair
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