PROGRESS IN GEOGRAPHY ›› 2020, Vol. 39 ›› Issue (3): 367-376.doi: 10.18306/dlkxjz.2020.03.002

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Market structure and competition of the three major airlines in China

DU Delin1,2, WANG Jiaoe1,2,*(), WANG Yi3   

  1. 1.Key Laboratory of Regional Sustainable Development Modeling, Institute of Geographic Sciences and Natural Resources Research, CAS, Beijing 100101, China
    2.College of Resources and Environment, University of Chinese Academy of Sciences, Beijing 100049, China
    3.School of Public Administration, China University of Labor Relations, Beijing 100048, China
  • Received:2019-01-22 Revised:2019-05-26 Online:2020-03-28 Published:2020-05-28
  • Contact: WANG Jiaoe E-mail:wangje@igsnrr.ac.cn
  • Supported by:
    National Natural Science Foundation of China(41722103)

Abstract:

Air China, China Eastern Airlines, and China Southern Airlines are the three major state-owned airlines in China, and they have significant influences in the air transportation market. Market competition of the three airlines has always been an important research topic in economics, management, and geography. Based on the flight schedule data, this study constructed a market share index and a market overlap index and used them to examine the structure and competition of the three major airlines on the Chinese and international markets in 2005 and 2015. The results are as follow: 1) The markets of the three major airlines have expanded rapidly over the decade of 2005-2015. In China, the three airlines have added navigation airports mainly in the central and western regions, especially in Heilongjiang Province, Inner Mongolia Autonomous Region, and Guizhou Province. These provinces are the new major market competition places. Among the three major airlines, China Southern Airlines has the largest number of absolutely dominant airports and flight routes, China Eastern Airlines has the largest increase, and Air China has a relatively small market. 2) Spatially, the three major airlines show significant regional differences in the domestic key markets, and each has a great advantage in its respective hub airports. The dominant routes of the three major airlines mainly form radial networks around their hub airports. Routes concentrated in domestic air transportation are mainly represented by competition among two of the three major airlines. With increasing market competition, the market shares of the three airlines in most of the major domestic airports and routes decreased. 3) In the international market, East Asia and Southeast Asia are areas where the three major airlines have focused. Their navigation airports, flights, and competing airports are mostly located here. In particular, Japan and South Korea are the countries of most severe competition of the three major airlines. However, the competition of the three major airlines in the international flight routes is not obvious—this is because they mainly set up routes between their hub airports and international airports, and their operating bases are very different.

Key words: airlines, flight frequency, market competition, spatial structure, China