中国民航业应对高铁发展影响对策研究 ——基于南航武广航线案例

1 Introduction

1.1 Background

By  the  end  of  2015,  the  operating  kilometers  of  China  high-speed  railway  has exceeded nineteen thousand kilometers, which occupies more than 60% of the world's high-speed  railway  kilometers.  China  has  become  the fastest growing  and  largest country in high-speed railway all over the world. 

According  to  the  data  from  China  civil  aviation  information  Network  Incorporated, along  with  development  of high-speed  railway’s  planning,  the  scope  of  high-speed railway’s  impact  on  civil  aviation  is  increasingly  larger.  As for airports,  there  are  75 airports  on  the  high-speed  railway  line.  Among  them,  there  are  31  airports  on  the operating  lines  while  44  of  them  are  not.  Moreover,  there  are  26  airports  that  has  an annual  passenger throughput  more  10  million  while  27  of  them  has  an  annual passenger  throughput  between  1  million  and  10 million.  As  for  routes,  there  will  be 320  affected  routes  after  the  full  implementation  of  current  planning. Among them, there are 93 routes crossing with the operating high-speed railway lines while 227 of them  are  not.  In addition, there  are  135  short  range  routes  which  is  within  800 kilometers, 122 medium range routes which is between 800 to 1500 kilometers and 63 long  range  routes  which  is  more  than  1500  kilometers.  As  for  airlines, almost  every airline company in China has suffered from high-speed railway in certain routes and most  of  their  base airports  are  located  in the  cities  which  high-speed  rail  lines  are crossing.

For  those  93  running  high-speed  railway  lines,  they  have  lower  performance  in capacity  growth,  passenger growth,  passenger  load  factor  and  earnings  growth  than average  civil  aviation  domestic  market  in  past  five years.  In  the  aspect  of  capacity, civil  aviation  domestic  market  have  an  annual  growth  of  10.6%  while  the operating high-speed  railway  lines  only  have  1.9%.  For  passenger  growth,  the  operating  lines only  have  a quarter  annual  growth  of  civil  aviation  markets’.  What  is  more,  the high-speed railway leads in the decline of five year passenger load factor, meanwhile, civil aviation domestic market has an annual earnings growth which is more than two times of high-speed railway’s.

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1.2 Meaning of the research

According  to  the  practice  of  foreign  countries,  in  the  market  that  operate  within  two hours,  the  civil  aviation only  takes  5%  to  10%  of  the  shares;  in  the  market  between two to four hours, the percentage becomes 20% to 40%; in the market more than four hours, the civil aviation has over 60% shares.

Based  on  the  data  from  China  Civil  Aviation  Information  Network  Incorporated,  by the end of 2015, high-speed railway has attracted 5.7% of total passenger number and 8.7%  of  revenue  from  civil  aviation  respectively.  And routes  within  800  kilometer affected  most.  There  is  no  doubt  that  the  operation  of  high-speed  railway  has fatal impact  on  the  short  and  medium  range  routes  of  civil  aviation.  It  causes  a  dramatic decline  in  the  quality  of some  profitable  and  crucial  routes.  This  is  the  reason  why civil  aviation  should  take  the  impact  on  passenger and  income  attraction  caused  by high-speed railway seriously, do its own research and find its way to cope with.

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2 Literature Review

2.1 Theory of oligopoly competition

The  recommended  market  structure  by  western  economics  textbooks  is  perfect competition  market  structure. Although  in  theory  this  is  the  most  efficient  market structure,  in  the  real  life  this  is  not  a  common  market structure  in  mature  industries and it often not seems to like that. Several or a dozen of monopoly enterprises own a half or more of the market share, namely the oligopolymarket, they are everywhere in real  life.  Oligopoly  market  is the  compromise  between  perfect  competitions  and completely monopoly. 

This  market  structure  is  usually  not  a  government  design.  Instead,  it  is  the  result  of market  selection  which is proven  in  different  industries,  such  as  the  GM,  Ford  and Chrysler  of  U.S.  auto  industry,  Merrill  lynch,  Goldman Sachs  and  Morgan  Stanley investment  banking  etc.  Industry  economics  master  Harold  Demsetz  from  the University  of  Chicago  addresses  that  efficient  enterprise  can  occupy  a  larger  market share and with the improvement of industrial concentration, the good performance of excellent enterprise is due to efficiency rather than market monopoly, which is saying that oligopolistic market structure is very high efficient. There is four kinds of market structure  which  is  discussed  by  western  economics;  there  is  rarely  in  complete monopoly market and fully competitive market; in the real economy, there is a lot of oligopoly  monopoly  markets  and  competitive  markets especially  for  the  oligarchic monopoly  markets.  Represented  by  Schumpeter,  some  economists  pointed  out  that "monopoly  leads  to  the  allocation  of  resources  inefficient"  judged  by  the  fact  that oligopoly  enterprise organization  in  the  economic  life  is  playing  a  more  and  more important role. But this point of view is built on the assumption of perfect competition which is lack of realism so the correctness of this view has been compromised. 

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2.2 Duopoly model

Duopoly model is also called the Cournot model or Cournot duopoly model, which is an early oligopoly model. It was presented by Cournot, a French economist, in 1838. Duopoly  model  is  the  earliest  version  that  Nash  Equilibrium was applied  and  it  is usually considered that it is the starting point of oligopoly theory analysis. This model states  that  how output  decisions  of  producers  that  compete  but  no  coordinate  with each other interact and then result in something between competitive equilibrium and monopoly  equilibrium.  Cournot  model  assume  that  there  are  only two  sellers  in  a market and there is no collusion between them. But they all know how each other act and then determine an optimal output which can produce maximum profit. 

Xu Feng, Yang Wendong and Zhu Jinfu(2012) have done their researches on Europe high-speed  railway  and  concluded as  following:  TGV  is  short  for  French  high-speed railway--  Train  a  Grande  Vitesse.  The  first  TGV  was  operated in  1981  from  Paris  to Lyon  with  the  length  of  417  kilometers  and  top  speed  270  kilometers  per  hours.  It reduced the time of travel from 3 hours and 50 minutes to 2 hours. After the opening of TGV, the capacity of railway increased from 22% to 40% while aviation decreased from  17%  to  10%.  Starting  in  1989,  TGV  opened  the extension  of  southeast  line, Strasbourg  east  line,  Atlantic  line,  northern  Europe  line  and  Mediterranean  line  and completed a high-speed railway network which centered Paris and covered the whole French and Europe. As a result, high-speed railway has a great impact on French civil aviation.  At  present,  TGV  has  90%  market  share  in  Paris  - Lyon  path.  Under  the impact  of  Strasbourg  east  line,  Strasbourg  Airport  and  civil  aviation  declined  14.8% and 26.1%  in  passenger  number  respectively  from  2007  to  2006.  Nowadays,  the competition between Air France and TGV is as follow: journey under 600 kilometers, TGV  has  90%  to  95%  market  shares;  journey  about  900 kilometers,  TGV  has  60% market shares; journey above 1200 kilometers, TGV only has 38% market shares. As a result,  if  convert  as  high-speed  railway  average  speed  300  kilometers  per  hours, journey  about  900  kilometers or  3  hours  will  be  the  critical  point  of  competition advantage between high-speed railway and civil aviation.

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3 Case Analysis ............ 17

3.1 Duopoly in fast transportation market ........ 17

3.2 Analysis of Wuhan - Guangzhou route’s operation details ............. 17

4 SWOT Analysis ............. 26

4.1 Strengths of civil aviation ...... 27

4.1.1 Civil aviation’s advantage in long range transportation .......... 27

5 Solutions ............... 38

5.1 Accelerating the internationalization process ................... 38

5.1.1 Intensifying the set-up of international routes ............ 38

5 Solutions

5.1 Accelerating the internationalization process

Civil  aviation  should  respond  actively  to  the  national  top  level  strategy  the  Belt  and Road. To intensify international route planning and construction and give full play to their  own  advantages,  a  "silk  air  way"  can  be created.  What  is  more,  airlines  should focus  on  the  layout  of  two  markets  along  with  the  Belt  and  Road, promote international  marketing  ability  and  prepare  for  the  future  international  routes development.

5.1.1 Intensifying the set-up of international routes

Long  Jilin  (2013)  came  up  with  ideas  that  although  high-speed  railway  can  reduce transport time greatly, its advantage focus on short and medium range transportation. Market  between  800  kilometers  and  1500  kilometers  is the  battle  field  of  civil aviation and air transportation. In the market over 1500 kilometers, civil aviation has outstanding advantages.  Therefore,  the  internationalization  is  the  key  to  the development  of  civil  aviation  in  the  future.  It is  better  for  civil  aviation  to  do  their own  market  research,  routes  investigation  and  feasibility  analysis.  On  this basis,  on the one hand, they should actively strive for the resources of medium and long range international  routes;  on the  other  hand,  route  planning  of  big  aircraft  should  be  well arranged.

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6 Conclusions and Inspiration

6.1 Conclusions 

After  scientific  analysis  and  demonstration  in  this  paper,  there  are  following  advices on  the  countermeasures  for civil  aviation  to  respond  the  challenge  from  high-speed railway:

1.  Civil  aviation  should  rely  on  the  national  top  level  strategy  "the  Silk  Road Economic Belt and the 21st Century Maritime Silk Road" and take positive measures in  pushing  the  development  of  the  international  routes,  giving ful play  to  the advantages  in  long  distance  transportation,  transoceanic  transportation  and  plateau  transportation, expanding  international  routes  and  the  Belt  and  Road  routes, accelerating  the  layout  of  two  markets  on  the Belt  and  Road,  striving  for  the improvement  of  international  marketing  ability  and  preparing  for  the  operation of international routes in the future. 

2.  Finding  new  profitable  domestic  routes  and  strategically  giving  up  routes  that high-speed rail way has absolute competitive advantage 

3.  Lowering  the  operating  costs  by  doing  a  good  job  in  fuel  cost  management, manpower cost management and cabin supply management. Civil aviation also should make efforts in developing low costs airlines and lower operating costs by improving the level of utilization efficiency of aircrafts.

4.  Enhancing  the  development  of  hub.  The  service  idea  of  civil  aviation  industry should  be  providing passengers with  easy  and  comfort  transportation  to  destination. Based on that, airlines should improve the level of transferring service, saving trouble for passengers by offering one-stop service.

5. Simplifying the check-in procedure. Passengers of civil aviation have long time in waiting  and  various  boarding procedure.  So  the  convenience  of  common  service should  be  improved  in  every  aspects  and  time  for  waiting and  procedure  should  be reduced maximally.

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