Road to Recovery
China domestic market enters expansion mode
New data from ForwardKeys shows encouraging signs from China’s domestic air travel market, led by a mix of commercial centres and leisure destinations spearheaded by Hainan Island.
Travel analytics company ForwardKeys is projecting a jump in Chinese domestic flight bookings as the impact of the COVID-19 outbreak eases. It expects a “significant uplift” in bookings after the 29 April news that Beijing lifted a 14-day quarantine requirement on travel between the capital and low-risk areas in China.
Chinese domestic air travel bottomed out in mid-February, from which point it has been in “muted recovery mode,” says ForwardKeys. In the week of 23-29 February, coinciding with a modest restarting of the economy and an increase in domestic air capacity, it jumped by +62.9% over the previous week.
From a low base it has since grown by +19.5% between the first week of March and the third week of April.
China domestic air arrivals year-to-date
Gradual recovery: The year-to-date picture for China domestic air travel; Source: ForwardKeys
ForwardKeys VP Insights Olivier Ponti says: “We have been expecting a jump in domestic flight bookings to occur as soon as domestic travel restrictions are eased and now that appears to be happening. While this looks like the emergence of the proverbial ‘green shoots’ of recovery; it is a domestic phenomenon; and Chinese international air traffic is still falling.”
The destinations leading the tentative recovery are commercial centres Guangdong, Zhejiang, Shanghai, Sichuan and Yunnan, noted ForwardKeys.
Travel to Shenzhen, one of the China’s first Special Economic Zones, and to Hainan island, China’s tropical holiday hotspot in the South China Sea, is likely to indicate the recovery trend as it develops, added the analyst.
China domestic air arrivals in Hainan and Shenzhen
Hainan travel should benefit from the May holiday that began at the weekend, with Shenzhen business traffic also on the rise (Source: ForwardKeys)
As we have reported elsewhere, in a major fillip for the offshore duty free business, the Chinese authorities have agreed a new scheme allowing Mainland visitors to Hainan to spend any of their unspent RMB30,000 (US$4,240) annual allowance online for up to 180 days once they arrive back – and have the goods couriered to their home. The business has also been boosted by the opening of two new offshore duty free stores on the island in April.
“We can confirm tiny green shoots of recovery in China’s domestic aviation market,” says ForwardKeys.
The Moodie Davitt eZine
Issue 279 | 4 May 2020
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