What is the best way to get from Shenyang to Beijing on only US$15? If you thought by train, not exactly – China Northeast airlines has slashed ticket prices to just CNY70 (US$10), cheap enough to give locomotives a good run for their money.
Shenzhen Air, Hainan Air and even the state-owned “big three” – Air China, China Eastern and China Southern – have resorted to offering up to 80 percent discounts on national routes as a desperate attempt to lure customers back to their seats.
The carriers have been decreasing their international services due to the global financial crisis, redeploying aircraft on domestic routes. This has resulted in an influx of seats that cannot be filled due to the insufficient demand in the local market. To make things worse, airline companies are expecting between 20 and 40 new aircraft next year, which means a bigger inventory and by the looks of it, fewer passengers.
With filling up cabins taking precedence over profitability, more fare bargains appear to be inevitable. “The outlook for the first half of next year is not good since price-cutting will continue,” said China Eastern company secretary, Luo Zhuping.