China Southern signals further expansion in Australia

China Southern Airlines has signalled further expansion in the Australian market as it inked a deal with Tourism Australia on Tuesday aimed at boosting marketing activities in China.

A three-year memorandum of understanding was signed on Tuesday in of Adelaide shortly after the arrival of China Southern Airlines flight CZ663 from Guangzhou, the first direct commercial passenger flight between China and South Australia. 

Officials present at the ceremony included Tourism Australia managing director John O’Sullivan and China Southern chief executive and president Tan Wan Geng.

Tan said he had great confidence in the Australian market.

 “Australia is a market we value highly where we still see opportunities to expand our operations further, as demonstrated by our decision to add Adelaide to our global network,” he said.

The comments come less than two weeks after governments of both countries signed an open skies agreement lifting restrictions on operations between major cities. 

Expansion and new services by Chinese carriers have already helped make China Australia’s most valuable inbound market with almost 1.2 million visitor arrivals now worth about $A9billion a year. 

China Southern has increased capacity to Australia by 35 per cent in the past year, with 56 weekly services now operating between Guangzhou and Sydney, Brisbane, Melbourne, Perth and Adelaide, as well as Shenzhen to Sydney.

 “China Southern continues to invest significantly in its Australian network and in Australian tourism, O’Sullivan said in a statement. “The airline now carries a fifth of all Chinese arrivals into Australia, more than any other international carrier. As we approach 2017, the designated ‘Australia-China Year of Tourism’, we look forward to building upon this important partnership.’’

Qantas, which has a partnership with China Southern,  and Virgin Australia, which is 40 per cent Chinese owned,  are also moving to increase services to China and take advantage of a growing cadre of Chinese  tourists  looking to travel overseas.

Tourism Australia estimates  that spending by Chinese visitors to Australia could rise to A$13 billion annually by 2020.  It says Chinese visitors currently spend an average of $8,000 each on every visit to Australia, more than any other source market.