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San Francisco, CA (PRWEB) November 25, 2012
Over the five years through 2012, the Airline industry in China has been growing at an annual rate of 15.0% to total $90.4 billion. After rapid development in the four years to 2007, growth slowed greatly in 2008 and 2009 due to a series of natural disasters, the global economic crisis, and stricter security checks due to the Beijing Olympic Games. However, as the economy recovered and demand for air travel rose, airlines rebounded strongly. Significant trends include an increasing private and foreign presence in the industry and the development of regional airlines in China's second- or third-tier cities.
The industry's four largest airlines, China Southern, Air China, China Eastern, and Hainan, contribute about half of total industry revenue in 2011. In the international airlines segment, the industry concentration level is even higher. IBISWorld anticipates that the market share concentration will increase as more mergers and acquisitions occur.
Growth in the Airline industry in China will gradually stabilize as air traffic volumes increase steadily and the industry matures. However, volatile jet fuel prices will be a significant risk factor for industry operators, says IBISWorld. Other challenges facing airlines include a still unstable global economy and a domestic economy suffering from inflation. In addition, the Beijing-Shanghai High-Speed Railway began operations in 2011, further intensifying competition.