According to the Civil Aviation Administration of China (CAAC), 135 out of 180 civil airports in China suffered losses in 2011, and the amount of loss reached 1.68 billion yuan. However, local governments interested in investing airports for airlines could bring huge economic benefits, the Beijing News reported on Jan 10.

An insider at a large domestic airport group told the paper that the defective airports are mostly secondary airports which do not have enough flight flows to realize profits.

According to the paper, most secondary airports in China survived on local government subsidies during the initial operation stage as costs were very high. For instance, four flights arriving and taking off at a secondary airport in one day costs 240,000 yuan.

However, costs haven’t affected local governments’ enthusiasm for investing in airports.

Li Jiaxiang, director of the CAAC, told the paper that the government of Yancheng city, Jiangsu province, spends 34 million yuan of grants-in-aid for local airports annually. The local airport in return helped the auto industry thrive, bringing in 3.4 billion yuan profit tax to the local government every year.

Insiders also told the paper that the development of the civil aviation industry in China is greatly imbalanced. Big airline companies are focused on aviation market development in main cities such as Beijing, Shanghai and Guangzhou and ignore the development of secondary aviation markets.

A manager from a large domestic airport told the paper that China should accelerate its airport building process.

According to the paper, China will build 60 more civil airports during the 12th Five-Year Plan period (2011-2015), increasing the total number of Chinese civil airports to 240. With over 2,800 civil flights, China will become the second largest aviation market in the world.

Source: Aviation Administration of China