Plenty of new airports but few regional passengers in China

13.3.2010   (Los Angeles Times)
From Libo, China            map
It’s less than two hours before boarding time but most of the staff of Libo Airport
are walking off their dinner of spicy dog meat with an evening stroll around the
parking lot.

Others sit in a circle on a grassy median smoking cigarettes and marveling at
a full moon. A security guard naps on a metal bench. A saleswoman behind the ticket
counter enjoys a shoulder rub in the darkened terminal.

“Can you at least turn on the lights?” asks a traveler carrying a bag of snacks.
“I’d like to see what I’m eating.”

Handling just two flights a week hasn’t fostered a deep sense of urgency for
the 50 or so workers at the airport. On this night, a garage door-sized video
monitor displays a single arrival and departure.

This is not how things were supposed to be when the $57-million airport opened
in late 2007. Local officials were so confident that tourists would flock to this
beautiful, mountainous county in southwestern China that they made the terminal
big enough to accommodate 220,000 passengers annually, and built a runway capable
of handling a 140-seat Boeing 737.

But only a few charters and budget carriers have established service here. A
grand total of 151 people flew in and out of Libo last year.

At a time when anxiety is growing over the United States’ aging infrastructure,
China is pouring billions of dollars into improving its transportation network
to catch up with the developed world.

China has added about 40 airports in the last decade alone, bringing its total
to 166. The U.S., by comparison, has 503 airports that serve at least 2,500 passengers
a year, according to the Federal Aviation Administration.

But in the mad dash to expand China’s civil aviation system, many new airports
are lacking one important thing: passengers.

Spurred by federal infrastructure money, easy bank loans and the cachet of having
planes land in their backyard, many small cities jumped at the opportunity to
lay down runways and open terminals.

“An airport is like a business card for the city. It can boost tourism and the
economy,” said Xu Hongjun, a professor at the Civil Aviation University of China.
“But a lot of small airports are not doing well. They need a lot of subsidies
from the central government. They were too optimistic.”

Despite the building binge, the majority of China’s air traffic is still concentrated
among a handful of large cities. The top eight airports commanded about half of
all passenger traffic. The top three — Beijing, Guangzhou and Shanghai’s Pudong
— handled half of all cargo traffic.

Experts say up to two-thirds of the nation’s airports are losing money. They
must compete with a quickly expanding high-speed rail network whose tickets are
often cheaper. Yet China plans to add 80 more airports over the next decade.

Officials believe the expansion will eventually pay off. China’s airline passenger
traffic has grown an average of 15% annually over the last four years and is estimated
to jump 44% over the next 10 years to 700 million fliers.

Last year China became the largest purchaser of jetliners on the planet, spending
twice as much as the U.S. did on passenger planes.

“China has led the world in recovering from the global air travel slump,” said
Richard Aboulafia, an aviation analyst for Teal Group in Fairfax, Va. “Its growth
rates are the highest in the world.”

But some locations chosen for new airports have left even experts scratching
their heads. Last year a facility was opened 13,000 feet above sea level on the
steppes of the Qinghai-Tibetan Plateau, where temperatures can drop to minus-43
degrees Fahrenheit. Engineers had to temper the concrete runway just to withstand
the harsh weather conditions.

Only 7,500 passengers used the airport last year.

“When can they make money? We’ve got a long way to go,” said Ping Wang, an advisor
to the Civil Aviation Administration of China and co-founder of GCW Consulting,
an aviation consultancy based in Arlington, Va.

“But an airport’s purpose is not just making money,” he said. “It’s a public
utility. . . . Without small airports, many areas of the country won’t be connected
to the outside world.”

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