Airline reform in China: market forces not as important as government fiat

The Chinese airline industry is facing a wave of mergers. Will the regional airline stars in Shanghai, Shenzhen and Hainan be able to survive in what promises to be a very uneven playing field?

You have to pity a hard-travelling Chinese salesman. He has to rely on the domestic airline system. Inedible food is the least of his problems. More serious are the lengthy and routine delays and airports stuck miles away from the city centre.

If an airline is half an hour late, that's basically considered punctual, says Huo Zhigang, a busy IT salesman in a Beijing-based software joint venture. On his last trip to Shenzhen, he had to spend the night at the airport after the last flight out was cancelled.

On the plus side, tickets are cheap - thanks to vicious fare cutting war between the carriers. The carriers all offer discounts to fill seats, even...

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