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China high-speed train forces airlines to stop flights

(Reuters circulated the following on March 26, 2010.)

BEIJING A new high-speed rail link between two inland Chinese cities has cut travel times so dramatically that all competing air services on the route have been suspended, state media said.

The suspension of flights between the gritty industrial city of Zhengzhou and Xian, home of the Terracotta Warriors, came just 48 days after the express railway began operations, the official Xinhua news agency said on Friday.

The 505 km (314 miles) railway, on which trains run at a top speed of 350 km per hour, has cut the travel time between the two cities from more than six hours to less than two, the report said. By contrast, flying takes just over an hour. Xian's airport is also located at least an hour away by road from downtown.

Before the railway opened, Joy Air, one of the domestic airlines flying the route, managed to sell an average of more than 60 percent of seats for the route, Xinhua said.

Zhengzhou airport confirmed that all flights to and from Xian had now stopped, the report added.

China is spending billions of dollars on a network of high-speed railways, including one from Beijing to the country's financial capital Shanghai, posing a challenge to airlines which had profited from China's vast size and slow roads and trains.

By 2012, China would have more than 13,000 km of high-speed railway, Xinhua said.

"By then, 60 percent of China's domestic air market will be affected by the high-speed railways," Liu Chaoyong, general manager of China Eastern Airlines, was quoted as saying.

China Eastern last year agreed to sell 35 percent of Joy Air, in which it held 40 percent, to state-owned Aviation Industry Corp of China.

Friday, March 26, 2010

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