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Bearing down
ASIA WATCH
TOM BALLANTYNE
Hong Kong is now linked to China’s high-speed rail network
hen Typhoon Mangkhut Of course, flying is certainly train services began between western
smashed through the ‘In the end, faster, though not that much faster China’s Chengdu and Xi’an, local
Philippines, Hong Kong once travel time getting to and from carriers cut daily flights between the
Wand southern China in however, it and through airports is considered. two cities to about three from several
September the region’s hard-pressed For many passengers, the train’s dozen.
airlines, already struggling in the face isn’t good wider seats, increased legroom and Most worrying, according to
of intense competition and rising freedom to move around mean greater industry observers, is the position
fuel costs, were faced with another news for comfort. And though airlines have the of Cathay Pacific Airways, which
hit to their bottom lines. Airports advantage of loyalty from customers is currently struggling to regain
at Guangzhou, Shenzhen and Hong airlines.’ who collect frequent flyer miles, profitability after two years of straight
Kong alone each experienced around according to one analyst, Ivan Zhou of losses. It is in the midst of a three-year
800 cancellations as they were forced BOC International Holdings in Hong transformation plan. Along with its
into closures by weather conditions, Kong, it may not be enough. wholly-owned subsidiary and regional
data from FlightGlobal showed. “You could possibly get more miles wing Cathay Dragon, the group has
Hot on the heels of Mangkhut, by paying your restaurant bills with a an extensive network to China. Cathay
another challenge has arrived that credit card than by flying short-haul,” Dragon operates to nearly 50 regional
threatens to knock airline operations he says. destinations and half of these are in
back on their heels. On September 23, For China, the ongoing expansion China. Cathay itself operates more
China’s rapidly expanding high-speed of high-speed rail is a crucial part of its than 20 flights into China and 11 of
rail network finally reached Hong transport infrastructure development these routes overlap the high-speed
Kong. What was a day-long rail trip and the completion of the link to rail network.
from Beijing has been cut to nine Hong Kong is seen as strengthening While Cathay hasn’t commented
hours. economic ties between the two. It is publicly on the challenge from bullet
But it’s not just the connection to also important for many Chinese cities trains, its management has certainly
the Chinese capital that is important. because for the first time it gives them been well aware of the impending
The new service actually links the a direct rail link with Hong Kong, the arrival of this form of transport into
Special Administrative Region (SAR) most important hub in the region. its home base. No doubt, over coming
with 44 mainland destinations In the end, however, it isn’t good months it will be keeping a close
through a bullet train network that news for airlines. All of them, both eye on just how much traffic is lured
now stretches for 25,000 kilometres. Chinese and non-Chinese, that ply away from its flights and no doubt
With the price of a rail ticket more their trade between Hong Kong and there will have to be some network
than half the price of an air ticket it is cities across the mainland, will be readjustments to compensate.
expected hundreds of travellers will affected. Facing the prospect of lost traffic
opt to take to the tracks rather than It won’t be the first time. As China’s is nothing new for Cathay. After
the sky – particularly when the train high-speed rail network has evolved direct flights across the Taiwan Strait
will take them directly into downtown over the past decade, China’s domestic between mainland China and Taiwan
Hong Kong and not an island airport carriers have already had to reduce started back in 2008 – previously
distant from the city. Add to that, they How will connecting Hong flights and even cancel some routes travellers between the two countries
can board a train without having to go Kong to China’s high-speed rail because of lost business, particularly had to fly via Hong Kong – it was
through many of the hassles involved network impact Cathay Pacific on flights under 800 kilometres. As predicted Cathay’s traffic between
in transiting airports. and Cathay Dragon? rob finlayson recently as last December, when bullet Hong Kong and Taiwan, one of its
most lucrative routes, would virtually
disappear. It didn’t happen and today
Taiwan remains one of the airline’s
strongest markets.
Of course, the threat from the
bullet train is different. In the case
of Taiwan, it turned out that despite
direct cross straits flights there
remained a heavy appetite for a
stopover in Hong Kong for shopping
and business. For a lot of travellers
though, the high-speed rail network
offers a pretty good alternative to
airports in China and Hong Kong’s
which are highly congested and where
flight delays are common.
Just what impact will high-speed
rail have on Cathay Pacific and
Cathay Dragon?
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