OK Air grounded, United Eagle (UE) under airport sanctions, and East Star on the verge of bankruptcy…. China's private aviation companies are beset by bad news these days. Furthermore, United Eagle has become part of state-owned Sichuan Airlines, while Air China appears hungry to devour East Star – a nationalisation trend is also apparent in the country's aviation industry that seems likely to break the already fragile market balance, forcing another reroute on the growing industry's path.
Since 2004 when China's first private airline company – United Eagle Airlines – was established, other private airlines have struggled against their marginal position for larger market shares. However, if the present situation is any guide, the year 2009 will bring harsher times than ever for these private airlines, as the turbulent international market, policy issues, and the companies' own weaknesses all contribute to their difficulties.
![East Star Airlines is experiencing a takeover attempt by Air China [Xinhua]](http://images.china.cn/attachement/jpg/site1007/20090326/00016c8b5de90b3573e401.jpg "East Star Airlines is experiencing a takeover attempt by Air China [Xinhua]") |
| East Star Airlines is experiencing a takeover attempt by Air China [Xinhua] |
Since last year, late payment of debt, grounding orders, and mergers are becoming the key words to describe some ailing private airlines.
In contrast, profits at Spring Airlines, Juneyao Airlines and Shenzhen Airlines are reported to have held up in 2008, and the companies have presented satisfactory financial reports, while other private operators have been dragged down by the gloom surrounding the entire industry and state-owned airlines have reported huge deficits.
Thus 2009 promises to be a year of polarization when Chinese private aviation will experience Charles Darwin's "survival of the fittest".
