Chapter 1128 Power Rent-Seeking Space

Wu Bing arrived at Panshi soon. The people in charge of Panshi Airport were all excited.

The work in the recent stage has not been smooth. Due to the problems of the Civil Aviation Administration, several new routes have not been approved. This immediately disrupted Panshi Airport's efforts to solve the increasing passenger traffic, which caught everyone off guard.

In the past, no one dared to say no to Fan Airlines and Panshi Airport. This time, I don’t know what the people from the Civil Aviation Administration took wrong. They dared to attack Fan Wubing’s industry.

After Fan Wubing got off the plane, he immediately held a high-level meeting in the airport conference room to inquire about some recent situations.

"In fact, this situation has existed for a long time. It’s just that it didn’t happen to our Fan Airlines," an executive reported to Fan Wubing.

Fan Wubing nodded. I remember that an executive of an airline company once said that it’s not that the leader promotes you to be an entrepreneur. Real entrepreneurs are not like us. Only the market can create entrepreneurs. We are just officials and businessmen.

As for Fan Wubing, he appreciated this statement because it revealed a major problem that is currently widespread in state-owned enterprises, that is, the nature of senior executives being neither officials nor businessmen.

Since 1985, the decentralization process of airlines has begun in China. At that time, the Civil Aviation Administration of China was the only national carrier in China, and it has transformed into introducing regional-based airlines, such as China Southern Airlines, Southwest Airlines, Northwest Airlines, and China Eastern Airlines.

The central government owns some airlines, and some provincial and local governments support the establishment of some airlines, such as Sichuan Airlines, Shandong Airlines, and Hainan Airlines.

In the early 1990s, with the continuous entry of new airlines into the market, it not only caused fierce market competition at that time, but also prompted airlines to quickly expand their fleets and networks. Due to the fragmentation of the aviation market, the Civil Aviation Administration of China stopped issuing operating licenses to new airlines in 1994, and there were already nearly 40 airlines in operation at that time.

Fan's Airlines, a private airline, can only be said to be a special failure. The situation at that time was relatively complicated. In addition, Fan Wubing's investment created the largest comprehensive airport in China, which also had a certain demonstration effect. Moreover, Fan Wubing's investment through Panshi The airport also introduced a large number of advanced passenger and transport aircraft to improve domestic air transport conditions, so the top management specially approved this very unique existence.

Later, due to the relaxation of ticket prices and the impact of the Asian financial crisis, destructive competition appeared in the air transport market. In 1998, the entire industry suffered large-scale losses.

At this time,

it was the time for Fan Airlines to develop. State-owned shipping companies had inherent deficiencies. However, Fan Airlines did not have so many problems, so it easily became the leader in the industry and the only most dynamic private airline in China.

Today, airlines have ushered in another major integration, the new Air China after the merger of China Southwest Airlines, the new Dongfang after the merger of Northwest Airlines and Yunnan Airlines. After the merger of China Southern Airlines, China Northern Airlines and Xinjiang Airlines, China Southern Airlines has become the three largest airlines in China, forming a three-legged tripod. The competition for flight time resources, which is the lifeblood of airlines, has also begun.

What is the golden time? It is the time when you can sit and wait to make money.

The head of the marketing department of an airline said that route time resources are one of the most important core competitive resources of an airline besides capacity. No matter how good your marketing is and how hard you work on your service. If you are given a time slot at two or three in the morning, you will not only fail to sell tickets, but also lose money on fuel.

Striving for more and better routes and flight time resources has become the common goal of all airlines.

If even the state-owned airlines that are related to each other are competing like this, then the situation of private airlines like all airlines can be imagined. It is no wonder that some people Dare to make trouble at this time, probably to take this opportunity to test Fan Wubing's reaction.

Fan Wubing has seriously considered this issue and feels that this time the matter is not simple, and it is likely to be a practical battle caused by the conflict of ideas about nationalization and privatization.

Recently, there is news that it is very likely to open the door to the monopoly of the domestic civil aviation industry in the near future. The influx of private capital into the civil aviation industry is unstoppable, and the various hidden barriers that have been stuck in the private aviation industry will be successively removed, but the most critical of these is that the saturated time resources in various places have become the most realistic constraint.

Unable to compete with large airlines for high-quality time slots, private airlines can only turn to low-price strategies and launch intensive price reduction activities, but these measures will obviously be collectively resisted by peers with state-owned backgrounds. There may even be a bad situation where the ticketing system is blocked, but this low-price strategy has not been favored by the industry, and it is believed that it is not a long-term solution.

The golden time of popular routes

With large airlines firmly in control, financial institutions do not have a fair policy environment for the support of private aviation, making it difficult for private aviation to move forward.

Although airlines of various ownerships compete fiercely at the terminal, in fact, most of their business is still outside the market.

Too scarce resources and too centralized approvals have made airlines that should have competed freely in the market place their marketing targets at the Civil Aviation Administration, a national department that can decide the life and death of an airline.

According to the explanation given by the executives of Fan Airlines to Fan Wubing, the price of getting a golden flight time every day from Monday to Friday at the airport is more than 10 million yuan.

Some airlines provide houses and cars. The costs spent are recorded as entertainment expenses in the company's account. It is legitimate to use the collective money to benefit the collective within the airline. And all the investment costs will eventually enter the ticket price and be paid by all consumers. As a result, domestic ticket prices are still at a high level in the world.

"The Civil Aviation Administration of China" said Fan Wubing, but he has no better solution now.

The Civil Aviation Administration of China belongs to the collective investment. But who is the beneficiary behind this collective investment? It is still difficult to say. Before clarifying the situation, Fan Wubing will definitely not make a big move. If he can't find the opponent's weakness, he will not act rashly. This is also the principle that Fan Wubing has always adhered to.

In the 1980s, in order to ease the huge contradiction between supply and demand of commodities, the country tried to divide the same commodity into two types: planned and unplanned. Selling at a lower price within the plan and at market price outside the plan is the dual-track price system.

This dual-track system helps to achieve the transformation of China's price model to a certain extent, promotes the transformation of the price formation mechanism, and gradually introduces the market mechanism into the production and exchange of large and medium-sized state-owned enterprises.

But on the other hand, when the economy is overheated, the contradiction between supply and demand is acute, and the gap between the planned price and the market price is large, this gives some officials and lawless people a lot of rent-seeking space, so some officials sell planned goods to the black market. Earn the difference from it, and China's scalper economy has begun, giving birth to China's first batch of powerful capital.

With the continuous deepening of reform, the market economy has gradually improved. Since the 1990s, the dual-track price system has gradually disappeared and is no longer legitimate. However, the dual-track price system, which has changed its appearance, has never left the stage of history. It has always appeared in various aspects of social life.

In addition to the approval of flight schedules, another rent-seeking black hole of civil aviation is the charter business derived from the centralized time approval.

The only way to operate a certain route is to apply for approval. When a charter company takes a fancy to a certain route, it needs to apply for approval from the corresponding regional administration, and then the Civil Aviation Administration will approve it. First, get the right to operate the route, then apply for flight schedules, and then transfer it to other airlines.

In the process of a series of approvals and transfers, a huge rent-seeking space has been created.

In the early years, when the charter business was booming, some companies directly contracted charter flights on some popular routes and then sold them to travel agencies. Take Beijing to Sanya as an example. If you charter a plane, the charter fee is 200,000 to 300,000 yuan, and the profit of the middleman is mostly around 20%.

The earliest batch of businessmen engaged in civil aviation charter business in China began to get involved in aviation charter business in the 1990s. They started by selling air tickets. Later, some of them also established airlines and gradually accumulated deep connections in the civil aviation industry.

These people are not actually engaged in shipping business. They just bribed some leaders of civil aviation to obtain the flight schedules of the airport routes they controlled, and then sold some of them to China Southern Airlines, making money out of nothing.

"When you apply for a time slot, the administration will show you the timetable and tell you that it is full." A senior executive of Fan Airlines said to Fan Wubing somewhat helplessly, "But if you go to a middleman or charter operator with a stronger relationship at this time, perhaps the hidden routes and time slots will be available again. This is the reality."

For example, in the 1990s, it was the golden age of foreign trade with Russia. At that time, it was very troublesome for domestic Mao planes to go through customs in Russia, but if it was a Russian charter flight, it would often be cleared by gray customs.

As long as you have goods and planes, you only need to break through the last obstacle to go unimpeded, which is the route operation rights and flight schedules. And these resources are precisely in the hands of the Transport Department of the Civil Aviation Administration.

It is obvious that since many years ago, in the civil aviation industry, the control of important resources by administrative power has formed a huge interest group. Behind the price distortion is the distortion of interest distribution.