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Business Insight

China's big 3 airlines must face up to the LCC threat

State-owned carriers should exploit their advantages to meet startup challenge

Beijing Capital Airlines and other low-cost carriers have captured 14% of China's domestic air travel market.   © Reuters

China's big three state-owned airlines still dominate the country's aviation market, but low-cost carriers have started to make a real dent in their market share with the help of recent regulatory reforms.

The collective market share of China's budget airlines has risen to around 14% from less than 1% a decade ago. The planned entry of AirAsia group into the domestic market via a new joint venture looked set to boost that, but the Malaysian company's deal collapsed late last month.

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