Tue, Jul 24, 2007 - Page 11 News List

Air China plans to add routes, staff

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Air China Ltd (中國國際航空), China's largest international carrier, will add routes and staff as the 2008 Olympic Games fuel demand for travel to its hub, Beijing.

The airline will operate more flights to the UK, France and Russia, as well as to the US, senior vice president Zhang Lan (張藍) said in an interview in Beijing.

It is also applying to add a route to Pyongyang.

The Beijing-based carrier plans to move all operations to a new terminal at Beijing Capital International Airport, set to open in March.

The terminal, Asia's largest, will be dedicated to Air China and its domestic and overseas partners, the airline said.

Beijing may receive 1.7 million visitors for the Olympics, including 1.1 million domestic travelers, the city's Olympic organizing committee said.

"The larger, new terminal will make it easier for Air China to add flights," said Jack Xu, a Shanghai-based analyst at Sinopac Securities Asia Ltd. "The new terminal guarantees space."

The carrier aims to boost its market share in Beijing to at least 50 percent from the current 44 percent after the move. It will add several hundred support staff and recruit volunteers to help serve Olympic visitors, Zhang said.

Air China also plans to join the Star Alliance, the world's largest airline grouping, by the end of this year, allowing it to sell tickets on partners' international routes. About 60 percent of Air China's sales come from domestic flights and the rest from international routes.

"Network expansion may help boost Air China's profit," Zhang said last Friday.

Expansion work at Beijing airport may reduce congestion and delays for Air China and other carriers. The new terminal and a third runway will more than double Beijing airport's annual design capacity to 78 million passengers.

The airfield, Asia's second-busiest after Tokyo's Haneda, has been overloaded as China's economic growth makes air travel affordable to more people. The airport handled 26 million passengers in the first half of this year, a 16 percent increase from a year earlier. It handled 48.7 million passengers last year, exceeding its design capacity of 35 million.

To cut congestion, the airport's operator will reduce the 1,100 flights it handles each day by 9 percent from September until the new terminal opens, Zhang said, citing a notice from the General Administration of Civil Aviation.

The carriers will hold discussions with the regulator about which flights to cancel, she said.

Air China's yuan-denominated shares rose 7.2 percent to 10.71 yuan (US$1.41) in Shanghai. Its Hong Kong-listed stock added 0.8 percent to HK$6.15 (US$0.79).

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