Two US airlines cut China routes as Beijing rivals turn up heat

American Airlines, the largest US carrier by passengers, said it would drop a route between Chicago and Shanghai. (Reuters)
Updated 22 August 2018
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Two US airlines cut China routes as Beijing rivals turn up heat

  • ‘The two China routes ... have been colossal loss makers for us’
  • Chinese passengers arriving at US airports are expected to nearly triple to 12.8 million in 2024 from 4.3 million this year

DENVER/SHANGHAI: Two US airlines on Tuesday cut routes between China and the US, underscoring increasingly tough competition from state-backed Chinese rivals as they aggressively expand their fleets with cut-price tickets.
American Airlines, the largest US carrier by passengers, said it would drop a route between Chicago and Shanghai, canceling the second direct flight from the US city to China in four months. It had canceled a flight to Beijing in May, although it still operates daily flights to the capital from Los Angeles and Dallas-Fort Worth, Texas.
“The two China routes ... have been colossal loss makers for us,” said Vasu Raja, vice president of network and schedule planning, adding that high fuel costs had also made the route unsustainable.
Hawaiian Airlines said it would from October suspend its thrice-weekly nonstop service between Honolulu and Beijing, which it opened in 2014, citing slower-than-expected growth in demand.
Competition from Chinese airlines is expected to grow with the anticipated easing of China’s near-decade-old “one route, one airline” policy, which would allow more local airlines to fly long-haul international routes.
“US airlines are at a severe disadvantage,” said Mike Boyd, president of aviation forecaster Boyd Group. “The majority of demand is China-generated, and that gives Chinese carriers the advantage.”
Chinese passengers arriving at US airports are expected to nearly triple to 12.8 million in 2024 from 4.3 million this year, and the profile is shifting from groups to independent travelers, according to Boyd Group.
United Airlines President Scott Kirby said Shanghai and Beijing had rebounded for the airline after several years of weakness, although revenue per available seat mile (RASM) was below levels of two or three years ago.
“We’ve had several years of weakness as there was an awful lot of capacity growth out of Beijing and Shanghai,” Kirby said on the sidelines of the International Aviation Forecast Summit in Denver.
American and Hawaiian said the route cancelations were unrelated to demands placed by China’s civil aviation regulator on foreign airlines to amend the way they referred to Hong Kong, Macau and Taiwan on their websites.
Chinese state media had earlier this month singled out the two companies and other US airlines as being among the last firms to comply with China’s demands.
“That issue of how Taiwan was displayed on our website had absolutely zero impact on this decision,” Hawaiian’s chief executive, Peter Ingram, said. “Our economic evaluation was well underway long before that issue arose.”


Saudi real estate valuers to benefit from RICS’ stamp of approval

Updated 29 min 18 sec ago
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Saudi real estate valuers to benefit from RICS’ stamp of approval

  • Deal to open up new opportunities in the Saudi market for chartered surveyors
  • RICS has accredited at least 118,000 professionals working in the development and management of land, real estate, construction and infrastructure

LONDON: Real estate valuers in Saudi Arabia are set to have their industry credentials further boosted following a preliminary agreement signed with the UK-headquartered Royal Institution of Chartered Surveyor (RICS).
Under the terms of the memorandum of understanding [MoU), members of the Saudi Authority for Accredited Valuers (Taqeem) are to benefit from training courses and qualifications approved by RICS.
RICS has accredited at least 118,000 professionals working in the development and management of land, real estate, construction and infrastructure.
It is expected the newly formed partnership will see the two parties work together to ensure their members reach internationally recognized standards of valuation which will bring greater transparency to Saudi Arabia’s property market and help boost investor confidence in the sector.
“Ths MoU paves the way to an agreement that recognizes Taqeem real estate designated members as RICS members after mapping educational, experience and membership requirements of each respective organizations,” said Sultan Al Jorais, Secretary General of Taqeem in a statement on Sept 24.
The Taqeem real estate training program will be considered as a RICS ‘approved’ and ‘fit for purpose’ course, he said, while RICS chartered valuers are also set to be granted interim membership of Taqeem.
“We believe that this MoU also provides a great opportunity for RICS qualified members to enter the Saudi market which will add value to the profession,” said Al Jorais.