China's Xiamen Airlines makes first US touchdown, with hopes for many more

China's Xiamen Airlines makes first US touchdown, with hopes for many more

Oct 3, 2016 - When Chinese president Xi Jinping visited the U.S. last September, his first stop was a Boeing factory north of Seattle, where he toured a 787-8 Dreamliner being delivered to Xiamen Airlines.

A subsidiary of state-backed China Southern Airlines, Xiamen Airlines is currently among China's largest carriers, a member of the SkyTeam airline alliance with more than 140 Boeing aircraft (and 30 more on order) — and China's only airline with an all-Boeing fleet.

Few U.S. travelers have heard of Xiamen Airlines but the carrier is determined to change that. Last Monday, Xiamen inaugurated its first direct U.S. route between Seattle and Shenzhen, one of China's largest and wealthiest cities.

"Shenzhen is known as the 'Silicon Valley' of China, and this new destination will be a tremendous opportunity for both business and leisure travelers to experience our shared values, Port of Seattle Commissioner Fred Felleman told CNBC at a ceremony at Seattle-Tacoma International Airport welcoming the first Xiamen flight.

He added Xiamen's arrival would be an added boost to the region's status as "a business and tourism hub."

Xiamen is making its move at a time when tourism and business traffic between the U.S. and China is growing quickly. In a recent study, Boyd Group International predicted that annual U.S. arrivals from China will more than double, going from 2.4 million in 2015 to over 6.5 million in 2020. "Over that period of time, more than 23 million Chinese will visit the US," the report added.

Located adjacent to Hong Kong, Shenzhen — with a population of 10 million — was China's first special economic zone. It is now a major tourism and technology hub that's home to telecommunications equipment manufacturer Huawei, internet giant Tencent Holdings and other companies that do business in the Pacific Northwest.

And the race is on to be the airline of choice for business and leisure travelers.

Before Xiamen's new Shenzhen service, flights from Seattle to cities in China (including Beijing, Hong Kong and Shanghai) were limited to carriers like Delta Air Lines or China's Hainan Airlines — even though a wide variety of U.S. and Chinese carriers fly between both countries.

However, Xiamen's Seattle-Shenzhen new route stands out, in part because it links two high-tech cities for the first time, Kazue Ishiwata, airline service development director for Seattle-Tacoma International Airport, told CNBC recently.

"Xiamen is not the biggest airline in China. There's Air China, China Eastern, China Southern and Hainan already in Los Angeles, San Francisco and other cities," Ishiwata said. "So it benefits a new entry carrier to begin service in a city where there aren't other airlines to compete with on the route."

The new route between Seattle and Shenzhen will operate three times a week with a Boeing 787-8 Dreamliner configured with four first class seats, 28 business class seats and 236 economy class seats, that will offer complimentary Wi-Fi for first and business class customers.

Xiamen Airlines isn't stopping with Seattle. The airline's inaugural North American flight took place in July, between Vancouver and Xiamen, and long-haul service between JFK International Airport and Fuzhou (FOC) is scheduled to begin February 15, 2017.

Another Xiamen Airlines route, between Los Angeles and Xiamen, is set to begin sometime in mid-2017. It's part of the strategy that the airline hopes will help it overcome a significant competitive advantage in the fast-paced travel market in the world's largest economy.

"The airline has some challenges," said Mike Waddle of AviationPros, a general service agent supporting various airlines in the U.S. market.

"Even though they're a very familiar brand in China and throughout Asia, they need to get name recognition for the brand in the United States and North America," said Waddle. That said, "the routing for this first U.S. flight is unique and it seems like a good marriage between two high-tech cities."

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