Qantas has decided to withdraw from mainland China due to intense competition from local carriers. The airline will be ending its Sydney to Shanghai route on July 28, citing low demand as the reason for the decision. This move comes just six months after the route was relaunched following the pandemic, and it represents the only nonstop link flown by Qantas between Australia and mainland China. Despite being Australia’s national airline, Qantas has struggled to compete with Chinese carriers who operate a significantly larger number of flights and seats between the two countries.
Chinese carriers currently operate more than 28,000 seats each week on 102 flights between mainland China and Australia’s three largest cities, with plans to increase this to 128 flights a week by the end of the year. Qantas, on the other hand, only flies five times a week between Sydney and Shanghai, offering just under 1,500 weekly seats. Recent ticket sales data has shown an increasing interest in Australia among outbound Chinese visitors, but they are choosing to fly with local companies rather than Qantas. The airline’s return to the mainland China market has been underwhelming, with flights operating at around half capacity in some months.
Qantas International CEO Cam Wallace has acknowledged the lackluster performance of the Shanghai route since the pandemic, stating that demand for travel between Australia and China has not recovered as strongly as anticipated. Despite this, he has not ruled out a return to Shanghai in the future and stated that the airline will closely monitor market conditions. With the scrapping of the Shanghai route, Qantas will be able to make enhancements elsewhere in its network. This includes the launch of a new route from Brisbane to Manila, which will begin in October, as well as an increase in services to and from Singapore and Bengaluru.
The decision to withdraw from mainland China will allow Qantas to focus on routes with increasing demand and new tourism opportunities. By redirecting aircraft from the Shanghai route, the airline is able to make enhancements to other routes in its network. This includes the launch of new routes to destinations like Manila and an increase in flight frequencies to cities like Singapore and Bengaluru. By reallocating resources and capacity to these markets, Qantas aims to optimize its network and cater to the changing travel demands of passengers. The airline will continue to adapt its network based on market conditions and demand trends to ensure a successful operation in the future.
