Taiwan-based China Airlines (華航), which marks its 50th birthday this week, can look back at half a century of turbulence, but the future could bring even more formidable challenges, analysts said.
While in the past an abysmal safety record was the main problem, now the carrier faces completely different threats from China’s aggressive state-controlled airlines and the region’s nimble low-cost carriers.
“It’s a company that has come through years of external shocks and storms probably shaken, but still fighting,” said Derek Sadubin, an analyst with the Center for Asia Pacific Aviation, a Sydney-based consultancy. “They’ve got the support of the Taiwan government behind them, which has given them a degree of confidence, but it’s an airline that really needs to step up a gear to face the challenges ahead.”
PHOTO: PATRICK LIN, AFP
Starting out on Dec. 16, 1959 with just two World War II-era flying boats, China Airlines has grown into an international carrier with a fleet of 66 modern aircraft.
What has also grown with the company, which is 54 percent owned by a state fund, is a record of spectacular crashes that have made it one of the riskiest carriers in Asia.
Among the more recent, in May 2002 a Boeing 747 smashed into the Taiwan Straits, killing all 225 people on board. Five years later, a Boeing 737 burst into flames while landing in Okinawa, although without fatalities.
A propensity for risk-taking among the carrier’s pilots, who for decades were recruited mainly from the island’s air force, has often been pinpointed as a liability.
“Their staff are more like government employees than their counterparts in other companies,” said Bruce Tsao, a Taipei-based analyst with Capital Securities (群益證券). “It’s an old company with a government background. That mentality may be related to its safety track record.”
The carrier’s reputation for poor safety has forced it to take a series of steps aimed at renewal “from inside out,” said Debbie Wu (吳宜蓁), a public relations expert at Fu-Jen Catholic University in Taipei.
“This ranges from organizational reconstruction to buying new jets and designing new uniforms, and the consumers have noticed the changes,” she said. “The public is forgetful, and the airline has diverted attention from the negative news by creating new topics with these moves. It has successfully turned its image around.”
But one thing has not changed: the company’s name, which dates from a time when Taiwan’s leaders, refugees from communist-controlled China, still claimed to represent all of the country.
China Airlines may in fact be a more apt name now than it has been for a long time because of the enormous opportunities associated with the booming China market.
A thaw in relations between China and Taiwan means the carrier now operates 55 weekly flights to 13 cities in China.
While it faces competitors from both Taiwan and China, the China routes are a sure earner because of rules that exclude foreign airlines.
“Basically, most players in this market are winners,” said Francis Hsiao (蕭義展), a Taipei-based analyst with Grand Cathay Securities (大華證券).
Nvidia Corp CEO Jensen Huang (黃仁勳) today announced that his company has selected "Beitou Shilin" in Taipei for its new Taiwan office, called Nvidia Constellation, putting an end to months of speculation. Industry sources have said that the tech giant has been eyeing the Beitou Shilin Science Park as the site of its new overseas headquarters, and speculated that the new headquarters would be built on two plots of land designated as "T17" and "T18," which span 3.89 hectares in the park. "I think it's time for us to reveal one of the largest products we've ever built," Huang said near the
China yesterday announced anti-dumping duties as high as 74.9 percent on imports of polyoxymethylene (POM) copolymers, a type of engineering plastic, from Taiwan, the US, the EU and Japan. The Chinese Ministry of Commerce’s findings conclude a probe launched in May last year, shortly after the US sharply increased tariffs on Chinese electric vehicles, computer chips and other imports. POM copolymers can partially replace metals such as copper and zinc, and have various applications, including in auto parts, electronics and medical equipment, the Chinese ministry has said. In January, it said initial investigations had determined that dumping was taking place, and implemented preliminary
Intel Corp yesterday reinforced its determination to strengthen its partnerships with Taiwan’s ecosystem partners including original-electronic-manufacturing (OEM) companies such as Hon Hai Precision Industry Co (鴻海精密) and chipmaker United Microelectronics Corp (UMC, 聯電). “Tonight marks a new beginning. We renew our new partnership with Taiwan ecosystem,” Intel new chief executive officer Tan Lip-bu (陳立武) said at a dinner with representatives from the company’s local partners, celebrating the 40th anniversary of the US chip giant’s presence in Taiwan. Tan took the reins at Intel six weeks ago aiming to reform the chipmaker and revive its past glory. This is the first time Tan
CUSTOMERS’ BURDEN: TSMC already has operations in the US and is a foundry, so any tariff increase would mostly affect US customers, not the company, the minister said Taiwanese manufacturers are “not afraid” of US tariffs, but are concerned about being affected more heavily than regional economic competitors Japan and South Korea, Minister of Economic Affairs J.W. Kuo (郭智輝) said. “Taiwan has many advantages that other countries do not have, the most notable of which is its semiconductor ecosystem,” Kuo said. The US “must rely on Taiwan” to boost its microchip manufacturing capacities, Kuo said in an interview ahead of his one-year anniversary in office tomorrow. Taiwan has submitted a position paper under Section 232 of the US Trade Expansion Act to explain the “complementary relationship” between Taiwan and the US
RSS