Private airline "marriage," Local Government what the odds g

Topic Origin

Side of the central enterprises is fierce, on one side are private enterprises on fighting back repeatedly. In the civil aviation industry, the same is being staged a "Guotuiminjin" show, but this time the protagonist is the expansion of local government. Of the financial crisis, the "bad money" several private airlines have Pong on the local government that tree in order to overcome the current crisis. A financial crisis appears to be accidental to the local government investment in the aviation industry and opportunities. If

Today, due to financial crisis-strapped local governments, private airlines are cut into the aviation industry to become the best breakthrough.

Yet the question before the industry can not be avoided: private aviation whether it is relying on state-owned assets, "Shang Shangqian"? In the civil aviation industry "to privatization," the tide of the airlines go in the future? How to look at the civil aviation industry is being staged this "Guotuiminjin" show?

Status

Private Aviation "collective selling"

Recently, Hainan Airlines Group Co., Ltd. (HNA Group, referred to as "HNA"), a low-key and Dalian in hand, and cooperation in forming the "Dalian Airlines." All this is only the state-owned capital, increase investment in the aviation industry in microcosm. August 26, Okay Airways Co., Ltd. (Okay Airways Company Limited, referred to as "Okay Airways"), former president of Liu Jie Yin told reporters confirmed that Okay Airways is currently also negotiating with the Tianjin Municipal Government, Tianjin Municipal Government, to discuss shareholder oke matters.

And as early as March of this year, the private airline United Eagle Airlines Co., Ltd. (United Eagle Airlines Co., Ltd., Referred to as "Eagle Airlines"), had been walking in the lead. In March 2009, United Eagle Airlines announced that Sichuan Airlines Group has been restructuring, Sichuan Airlines with 76% of the shares ranked the first largest shareholder. United Eagle Airlines became the first home "to the privatization of the airline."

The latest news shows, Sichuan Airlines is preparing to the model of its stake in Eagle in the East Star Airlines Co., Ltd. (East Star Airlines Co., Ltd., Referred to as "East Star Airlines") from taking place again. August 26, East Star Airlines, Director of Strategic Development confirmed to reporters Lin Zhu, Sichuan, East Star Airlines will provide operational support and assistance, do not rule out the possibility of stars into the shareholders.

Analysis 1

State-owned private airline seeking refuge with whether it is "Shang Shangqian"?

Throughout the selling of private aviation arena, buyers often only two categories: local government; First, the background with a State-owned airline. However, the civil aviation observers doubt also exists: While a good cool shade under a tree, but the hard-won access to first-line living space, relying on state-owned assets whether it is private aviation, "Shang Shangqian"? The introduction of state-owned assets is quite upset?

A private domestic airline CEOs on condition of anonymity: I personally think this is quite upset. Attract investment capital, the government or the state the final result is that we finally become a state-owned enterprises. Is because private enterprises are short of money, and the Government can continue to raise capital, the end of our shares will become increasingly shrinking, and it lost the right to speak.

United Eagle Airlines Sun Zhijun, Deputy General Manager: No one can say that they are not short of money private airline. Private aviation development of the roads made it hard

Okay, former president of Liu Jie Yin: private aviation in our country was born just five years, but this is the way walk abnormalities difficult. Is a common phenomenon in this industry, the airline defaulted on the lower reaches of the general costs, such as refueling in arrears in the CAO, sales letters, etc., when in arrears in the Air, but in bad times, the private aviation is often the first to be sanctions. So that the trade can still remember that, in 2007 due to outstanding fees, CAO Hebei Branch refused to Eagle flight refueling, resulting in hundreds of passengers were stranded at the airport, to the United Eagle Airlines has brought a great crisis.

In addition, applying for bank loans that they clearly do not lend to airlines, private companies, new start a company, we are All roads lead to taboo, find the money be prohibitively difficult.

Spring Airlines Co., Ltd. (Spring Airlines Company Limited, referred to as "Spring Airlines") and Zhang Lei: private aviation in the popular route when you apply for the same appeared to be inadequate. Spring Airlines have always wanted to enter the most profitable of the Beijing-Shanghai route, but has not been approved. The industry believes that the most popular routes in our private aviation lack of right to speak, simply can not compete with the three major aviation groups. Private aviation is the main reason the policy entangled

CEOs of private aviation in the above view, the leading private aviation is the main reason the policy subject to constraints. For example the Civil Aviation Authority had issued a directive, the new airline to introduce an annual volume of the aircraft fleet size may not exceed 35%, which suddenly disrupted our plans to introduce the aircraft. The CEOs of "tears" to describe the dilemma of private aviation: "It's like playing in the football game, we have all been tied the hands and feet, how likely to play out the best level?

Analysis 2

Why do local governments would like to airline shares?

"Airlines are short of money, local governments lack of political achievements, the two sides hit it off." One who asked to remain anonymous in the industry comments are, "the marriage of local government and private aviation." In addition, according to industry analysts, many local governments and airlines localization of the complex. Yunnan provincial government is a typical example.

Yunnan provincial government of the people: the need for a stake in Yunnan airlines to adapt to the needs of Yunnan Province, Investment and the crosswise union. Yunnan Province's foreign exchanges because of growing demand, we urgently need to open new international routes.

China Civil Aviation Management Institute Associate Professor, ZOU Jian-jun: Obviously, if there is an own airline strike and the local government decision-making will be more right to speak. The Government generally agreed that air on the local economy obviously pulling effect, coupled with the opening of routes is a very good performance engineering.

Analysis 3

Whether it will affect the pattern of China's aviation?

This also has the industry been predicted: within the next three years, China's private airline will be nothing left, because they will be put on the state-owned assets were all hat. The question is whether this will affect the pattern of China's aviation?

Air China Limited (Air China Limited, referred to as "Air China"), within the people: local governments can give airlines only financial support, in the management experience, network layout, strategic positioning, etc., the private aviation is still unable to get a strong improvement.

China Eastern Airlines Company Limited (China Eastern Airlines Corporation Limited, referred to as "Eastern"), Deputy General Manager Luo Zhuping: From the Asian aviation market, the overall point of view, China's airlines have been in the service industry chain in the low-end customers, the real high gold content customers are Singapore Airlines (Singapore Airlines Ltd., referred to as "Singapore Airlines"), Hong Kong Cathay Pacific Airways Limited (Cathay Pacific Airways Limited, referred to as "Cathay Pacific"), Emirates Airline (Emirates Airlines) and other companies covered. The state-owned airline's top priority is to enhance its international competitiveness. The future of private aviation and the background of existing State-owned airline will continue to be "bridge owned by bridge, road return."

Analysis 4

Airlines go in the future?

United Eagle Airlines Deputy General Manager Sun Zhijun: At that time Eagle has several potential investors, but the Sichuan Airlines has the resources, professional background and experience, it is the Eagle the best choice at that time.

Okay, former president of Liu Jie Yin: There is no prior private aviation, the industry focused on three major contradictions and the local airline who Aviation Group, the private aviation appears, contradictions shifted. The civil aviation market now seems difficult, in fact very active, they should be allowed to Air China, Hainan Airlines and private airline who were free development.

China Eastern Airlines Deputy General Manager Luo Zhuping: State injection Eastern shareholders in decision-making matters, the private aviation should be looking for their investors. As a market economy, private aviation should continue to exist, after all, competition would bring more progress.

China Civil Aviation Management Institute Associate Professor, ZOU Jian-jun: local government injection of funds only temporarily solve the problem, for the airlines, several hundred million dollars of funding will soon be burned, the key is how to allow the company to achieve sustainable profitability.

Inspiration

Explore the operational characteristics of the living space to get

Spring Airlines might be described as the benchmark for private aviation. Since the beginning of a clear and defined as low-cost airline Spring Airlines has been insisting cheap, not only the use Spring International Travel Service's network and Web sites to direct flights, will all of the aircraft fleet models unity in order to achieve energy savings Aviation Supplies reserves, the flight cost.

Nevertheless, there are industry insiders believe that the number of dependent on the success of Spring Airlines in Shanghai market, a unique advantage. "Spring and Autumn's success is hard to copy, private aviation is necessary to explore their own strategic models and operating characteristics in order to obtain living space."

Comments

Life-saving straw can save how long?

There is no doubt, the private aviation The best way to avoid the economic crisis is to find strategic investors, escape the current crisis to say, after all, survival is the first.

"If we can smooth the introduction of the Tianjin municipal government, I think the next 5 to 10 years, which we will be more stable, no longer faces life and death situation." Okay tone Liu Jie, former president of optimism. But the China Civil Aviation Management Institute, Associate Professor ZOU Jian-jun said that the Government resources and the government's money is not inexhaustible, and if do not find their location and the market, private aviation is still tackle the backlog. "Like a seriously ill patient dying, injection that will soon awake, but if the disease is not eradicated, the next issue will appear as a valley."

The most important issue facing the private aviation is the policy not equal. In approving the route towards flight time, the introduction of aircraft, the state-owned aviation enterprises is clearly an advantage. Private aviation The second major problem faced is that their strategic positioning unclear.

More deadly, the private aviation from the date of birth on the doomed fate of its fragile financial chain. According to the 2004 enactment of the Civil Aviation Authority of "domestic investment in civil aviation requirements (draft)," In China, only 80 million yuan of registered capital can be an airline, but even the cheapest to buy a new aircraft also need 200 million yuan. Because the brand effect, the airlines can make use of, including bank loans, including a variety of financing channels, with 5 billion to nearly a hundred million things. However, this is like the ice dancing, once the huge market decline, the private aviation will have to face financial constraints of the situation, or even run out of cash strand breaks crisis.

Therefore, the local government shares, only some way towards alleviating the financial strain of private aviation, and can not eliminate the system of chronic illness.

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