China Eastern Starts Building $1.9 Billion Facility at New Beijing Airport

(Beijing) – China Eastern Airlines Corp., one of the country’s three largest carriers, started construction of a 13.2 billion yuan ($1.9 billion) aviation facility at the new mega airport going up in southern Beijing.

The China Eastern project, covering 1.17 million square meters, includes facilities for cargo services, flight maintenance, catering preparation, offices and passenger services. The new airport will be the world’s largest.

China Eastern said it plans to deploy 150 to 200 planes, about a third of its fleet, at the new center. More than 20,000 China Eastern employees will work there. After it goes into operation in 2019, the new Beijing airport will serve 30 million passengers a year flying between Beijing and destinations in America, Europe, Australia and Asia.

Because of fast-growing air travel demands, the existing Beijing Capital International Airport is running out of capacity. In 2016, the airport handled 94 million passengers, close to its maximum of 96 million. The new $12.9 billion airport in the southern suburb of Daxin with as many as seven runways will accommodate about 100 million passengers a year.

The biggest carriers operating at the new hub will be China Eastern, which dominates air routes to China’s financial center Shanghai, and rival China Southern, the major carrier based in southern China’s export gateway Guangzhou. Each will account for 40% of the airport's passenger traffic, according to a construction plan approved by the State Council last July.

China Southern said it is preparing to build an equivalent facility in the new airport with an investment of 14.8 billion yuan.

According to the government’s plan, the new airport will mainly serve members of SkyTeam alliance, a global airlines group including China Eastern and China Southern. The existing airport in northeast Beijing would become the hub for AirChina and its fellow airlines in the Star Alliance.

The new airport, where construction started in late 2014, will make Beijing one of several major cities around the world with two international airports, including New York and Tokyo.

Contact reporter Han Wei (weihan@caixin.com)