Beijing’s decision to reopen China's borders from January 8, scraping stringent Covid testing and quarantine rules, and removing the policy under which foreign airlines could fly only one route to the country and operate no more than one flight a week, has prompted European carrier's to resume service to the People’s Republic.
However, rebuilding the Chinese networks to pre-pandemic levels comes with new challenges because Russia has closed its airspace for European Union (EU) and UK operators. Airlines traditionally have used the Siberian corridor for flights connecting Europe with the Far East, including China.
“European carriers have been badly hit by the Siberian overflight ban,” Patrick Edmond, managing director of Ireland-based consultancy Altair Advisory, commented. “Finnair is the most extreme case but everyone else has been affected to a greater or lesser extent. They all are faced with increased costs owing to longer routings caused by the airspace closure.”
The impact of the fall-out from Russia's invasion of Ukraine varies by route. A quick play with the Great Circle Mapper app suggests that Finnair must fly about 40 percent farther to Tokyo and about 55 percent farther to Beijing, whereas, from London, British Airways might “only" have to fly about 20- to 25 percent farther to Tokyo and Beijing, Edmond explained.
The longer flight time leads to higher fuel burn and costs, but the effect goes far beyond that, noted Edmond. “These are big detours,” he told AIN. “Some aircraft are not capable of flying the longer routing and crew rest periods at the Asian airports might be longer, leading to still more costs.”
Analysis by Leeham News of a Finnair Airbus A350 flying on the Helsinki-Tokyo Narita route last year found that the new routing increased operating costs from $120,000 to $171,000 before considering higher fuel prices.
The longer flight times might also present a conundrum for network planners. “An inability to get the aircraft back in time [to link with the outbound wave of flights] means the hub connectivity is messed up and aircraft utilization is lower,” Edmond said. That applies especially to hub airports with a relatively small number of waves, such as Helsinki. In the case of a hub like Frankfurt, Lufthansa operates more banks so it can better handle the connectivity impact, but it still suffers from aircraft utilization and crew efficiency effects. “[Moreover], maintaining this hub connectivity surely creates an enormous headache when flying to slot-constrained airports,” he added.
The longer routes do generate more carbon emissions, which airlines would need to offset under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), though Edmond describes those costs as “trivial.” Conversely, he cautioned that the additional carbon dioxide might have a “material” effect on costs if the EU would decide to include long-haul flights in its emissions trading system (EU ETS) from 2026. “I can imagine that, if this airspace closure continues and if long-haul flights are included in the EU ETS, that European airlines will look at finding a way around it with their Asian joint venture partners,” he said. For instance, Air France KLM maintains a joint venture with China Eastern Airlines (which is also a shareholder in the Franco-Dutch group) and British Airways has a joint business agreement with China Southern Airlines. The Chinese partners could assume more flying and the European partners hypothetically could lease out some widebody aircraft for their partners to operate, Edmond asserted.
Air France KLM declined to comment on whether or not it equally shares the higher costs for flights to China with China Eastern under the terms of its current metal-neutral joint ventures. “We do not disclose the details of our alliances,” it told AIN.
Chinese Carriers Enjoy Commercial Advantages
Meanwhile, Chinese cargo carriers continued flying across the airspace of their country's ally Russia to serve major freight hubs in Europe, like Liege in Belgium, while EU and UK-based airlines had to use the longer Polar route or reroute over southern Europe, Turkey, and Kazakhstan, former Eurocontrol director general, Eamonn Brennan, observed during a Eurocontrol event in Brussels late last year. “At the moment, it's below the radar. But when you add passengers and China opens up, hopefully by the first quarter of next year, then you will see the stream become very intense,” he said. “The Chinese carriers have a huge advantage over the European ones.”
Air Transport Association (IATA) director-general Willie Walsh shares Brennan’s view. Speaking to reporters at the trade body’s global media days in December, Walsh warned that Chinese carriers would gain a competitive advantage over their European rivals once Beijing relaxes its Covid restrictions because they still can transit through Russian airspace.
“We are following that topic. As always, our goal is to work on a level playing field,” an Air France KLM spokesperson commented. Shai Weiss, Virgin Atlantic’s chief executive, has advocated for UK and EU leaders to enforce a “level-playing field” among airlines in relation to Russian overflights while the airline’s founder, Richard Branson, has said that he backed a ban on Chinese airlines coming to the UK via Russian airspace, the Telegraph reported. Virgin Atlantic plans to join Air France KLM in the SkyTeam alliance this year; both companies have Delta Air Lines as a shareholder and participate in a transatlantic JV.
Air France restarted flights from its hub at Paris Charles de Gaulle to Hong Kong on January 9 and plans to upgrade the three-times-a-week service to a daily on July 1. It also expects flights to Beijing Capital and Shanghai Pudong International Airport to be operating daily by that time. The airline uses a 279-seat 787-9 for service from Paris CDG to Beijing and Hong Kong and a 777-300ER for service to Shanghai. The SkyTeam alliance member operated up to 32 times per week to and from mainland China before the pandemic. Also, Air France's sister airline KLM plans to increase the frequency of flights to greater China starting March 26 and will operate six non-stop flights from Amsterdam to both Beijing and Shanghai and relaunch a service three times a week to Hong Kong. Beijing and Shanghai will upgrade to daily services in May. “The Chinese market is important to the KLM network because of the level of demand from business travelers,” the Dutch carrier noted, adding that the planned increase remains subject to government approval.