New Routes in China are developing at an unprecedented pace both nationally and internationally.
During this morning’s 'Doing Business in China' World Routes Talk, Dr Zheng Lei, Director of Centre for Aviation Research, and Visiting Professor, University of Surrey, and Civil Aviation University of China noted that from 2015 to 2016, 114 new national routes launched in China, while in 2015, 19 new international routes were also created.
What is striking about the recent growth in international routes in China is the emergence of China’s tier two cities servicing international destinations. This trend was demonstrated by yesterday’s announcement by World Routes 2016 host, Chengdu Shuangliu International Airport which is launching nine new international routes over the next 12 months to destinations including New York, Moscow, Dubai, Sydney and Madrid.
With the unabated growth of the international aviation market from China, co-speaker, John Grant, Director of JG Aviation provided insights into how Western companies can court Chinese business and develop their market.
Grant noted that for the first two-to-three years long haul services in China would be loss making. This is due to a variety of factors including directional imbalance - the majority of travel is China outbound tourism and business travel, significant seasonality - especially in student travel, and the low levels of inbound cargo shipping.
The consultant identified some of the important social and cultural differences in China that need to be understood. Understanding the processes and needs of Chinese partners and customers is vital for success. From providing Chinese language signage in a European or American airport, through to providing hot drinking water taps in the concourse; understanding the customer is crucial to a positive passenger experience.
Within the next five years Grant believes all major Western airports will be offering at least one China route. However to succeed in attracting passengers and forming relationships with relevant parties in China, understanding and respecting “Guanxi" is vital.
Developing trusted business relationships takes time in China, especially for organisations without a history in the country. Mr Grant explained that you may make a business trip expecting to have significant in-depth conversations and end up playing golf and having meals with your partner, but this is a crucial aspect of establishing trusted relationships. Once this happens the wheels will start turning very quickly.
China represents an immense opportunity to all members of the aviation industry, but what is abundantly clear is that you must understand the unique nature of both doing business here as well as understanding its customers.
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