Private carrier Spring Airlines held talks in Shanghai yesterday with the General Administration of the Civil Aviation of China (CAAC) to discuss policy barriers blocking the operation of budget airlines.

"We have to reduce operating costs to offer consumers low-price tickets," said Li Weiming, Spring’s deputy general manager of planning and development, "But the measures we want to adopt have failed to meet the requirements of the nation's civil aviation regulations."

Three other private airlines, Okay Airways based in Tianjin, Eagle Airlines in Chengdu, Sichuan Province, and Huaxia Airlines in Gansu Province, are seeking to establish no-frills airlines, but are facing similar problems.

Liu Jieyin, president of Okay, which in March became China's first private carrier to take to the skies, tried to adopt a low-cost strategy for his company but was frustrated.

"In the existing policy environment, we have found a lot of insurmountable obstacles to reducing operating costs," Liu said.

Consumers, airport representatives and aviation experts were also present at yesterday’s meeting.

Spring planned to provide no in-flight meals in the price of the ticket but to offer a complimentary bottle of mineral water.

It proposed that if a flight was delayed or cancelled and it was the carrier's fault, it would not provide free meals and would offer lodgings only when the delay exceeded four hours after 10 PM.

The CAAC requires airlines to provide board and lodging to passengers if a flight is delayed by more than four hours at any time of day. If the delay exceeds 10 hours, passengers are entitled to at least a partial refund.

Other conflicts with CAAC regulations include the maximum weight of luggage included in the price of a ticket, and landing and takeoff fees at airports, Li said.

Spring Airlines, owned by Shanghai Spring International Travel Service Ltd, plans to start operations before the end of the year.

Li said. "China's aviation policies fail to support the development of budget airlines, but Spring is trying to pave the way for them."

CAAC officials declined to comment on the feasibility of low-cost airlines in China.

(China Daily June 30, 2005)