China’s high-speed rail is so popular, it’s hurting the domestic airline industry [View all]

[marmar]

China Southern Airlines is the latest Chinese airline to post miserable year-end 2013 results. Net profit dropped 24% to 1.99 billion yuan ($321 million), and operating profit fell 70%. China Southern Airlines joins Air China, where net profit dropped 32% in 2013, and China Eastern Airlines, where it fell by 25%.

High oil prices, as well as increased competition from low-cost carriers and each other, have taken a toll. But, as each airline has recently acknowledged, so has China’s massive and growing high-speed rail system.

As Quartz reported last August, the costly and sometimes under-used rail network was shaping up to be a vital part of China’s growth strategy. It doesn’t have the hurdles of the airline industry: Airlines in China struggle to get clearances from the military to expand flight paths, and China’s major airports have earned the title of the most-delayed in the world, where passengers sometimes riot to protest long waits and miserable customer service. .................(more)

The complete piece is at: http://qz.com/193556/chinas-high-speed-rail-is-so-popular-its-hurting-the-domestic-airline-industry/