Sichuan dives into leisure market with Maldives

Sichuan Airlines previously operated a domestic only network with a main base in Chengdu. It flies to 43 domestic destinations with a fleet of narrowbody aircraft. This includes A319/A320/A321 and regional jet aircraft. Chengdu's central location has allowed Sichuan to create a strong domestic network and it is now taking its first step into the international market with flights to the Indian Ocean islands of the Maldives.

The carrier has one widebody aircraft, an A330, that it currently operates from Chengdu on the trunk routes of Beijing and Sanya. This will now also be deployed to Male in the Maldives.

The Maldives is a popular destination for Chinese tourists which is illustrated by SkyTeam member China Southern which currently operates a successful twice-weekly service from Guangzhou to the Maldives, also with A330 equipment, and Hainan Airlines has applied to the Civil Aviation Administration of China (CAAC) to operate a twice-weekly Beijing-Male-Johannesburg route with A340-600 equipment.

IATA BSP data between May 2009-10 shows that that over 59,000 O&D passengers flew between China and the Maldives in that period, with passenger share by carrier listed below:

Source IATA BSP data (Airport IS) May 2009-10

Although the numbers are relatively high, the potential for traffic is huge with Chengdu having a population of over eleven million.

WHY SICHUAN AIRLINES HAS CHOSEN THE MALDIVES?

The Sichuan Airlines' network strategy is largely built in partnership with and around the needs of its travel agents and tour operators. International travel is China is channelled through a small number of travel agents that control international travel.

Growing wealth within China, which goes hand in hand with a growing demand for travel to more exotic destinations, underpins many Chinese airlines' expansion plans into pure leisure markets. Maldives is an excellent example of this and China Southern's successful move to Male will have encouraged Sichuan to choose the Maldives as its first international leisure route.

These destinations are, for the time being, packaged, as most Chinese tourists have to travel in groups and on group exit visas. This means that any future destinations will be limited to markets that can be easily packaged and have good appeal to a mass market.

The new service also show that the Chinese market is starting to fragment away from the big three airports of Beijing, Guangzhou and Shanghai, following the trend in Europe where leisure travel has become highly regionalised.

Sichuan has publically stated that it plans to serve more leisure international markets and will use World Routes in Vancouver to commence negotiations. Therefore it is important that tourism authorities targeting the rapidly growing Chinese market need to be in Vancouver to meet this growing carrier.