China has detailed plans for a funding scheme aimed at incentivising airlines to continue or restore services in the light of the heavy network cuts amid the coronavirus outbreak.

In a notice issued today, the Civil Aviation Administration of China (CAAC) outlined an initiative to provide support for domestic and foreign carriers to retain or resume international services to mainland China.


Source: Shutterstock

The reward scheme is split into a CNY0.0176 ($0.0025) per seat kilometre reward for flights on routes served by multiple airlines, and a CNY0.0528 reward per seat kilometre for a route where the carrier is a sole operator. The policy implementation period covers 23 January to 30 June.

International services to and from mainland China have been heavily reduced since the outbreak emerged in Wuhan during January. Many international carriers began suspending services to mainland China in late January and have since suspended flights through February and March, with several pushing these suspensions into April. Chinese carriers too have been forced to suspend or reduce services on their international networks.

Figures released by IATA today for January show global traffic growth of 2.4% compared with the same month in 2019 – which marked the slowest monthly rate of passenger growth since the volcanic ash cloud in April 2010.  

“January was just the tip of the iceberg in terms of the traffic impacts we are seeing owing to the Covid-19 outbreak, given that major travel restrictions in China did not begin until 23 January,” says IATA director general Alexandre de Juniac. ”Nevertheless, it was still enough to cause our slowest traffic growth in nearly a decade.”

Notably, IATA reports Chinese airliness’ domestic traffic fell 6.8% in January, reflecting the impact of flight cancellations and travel restrictions related to the coronavirus outbreak. As capacity was only cut 0.2%, passenger load factor on Chinese domestic routes plunged more than five percentage points to 76.7%.