A Tale of Two Cities Supporting Xinjiang

Just as Han Jidong was busy planning the route internally and externally, an unexpected turning point appeared in the data predicament.

Zhai Yang, carrying a stack of printing papers, knocked on the door of Han Jidong's office.

"Mr. Han, I...I made a model."

Zhai Yang somewhat awkwardly spread out the charts and data, "Using the regression analysis we learned in our professional courses, combined with historical data, I proved that the opening of domestic air routes in Xinjiang can drive freight demand outside Xinjiang."

Han Jidong took the stack of papers. The charts clearly showed that after the opening of passenger routes to Kashgar and Hotan, it would be more convenient for fruit farmers to travel to and from Shihezi, which would drive the growth of local agricultural products transported to the east. In turn, this growth would support freight routes to Guangzhou, Chengdu and other places.

"You mean... use passenger transport to carry freight transport, and use transport within Xinjiang to transport outside Xinjiang?" Han Jidong asked.

Zhai Yang nodded vigorously: "That's right! Doesn't the Civil Aviation Administration need passenger flow forecast data?"

If we only consider local customers, that's certainly not enough, but if we take into account the potential demand driven by agricultural product transportation, such as business exchanges and fruit farmers coming to the city for errands...

He pointed to the model's final conclusion, "Three years later, the average load factor for the fifteen routes will reach 68%, and the cargo load factor will reach 72%!"

"Good lad! Will this model convince Old Wang?"

"I've already gone to see Section Chief Wang."

Zhai Yang smiled sheepishly, "He stared at the model for half an hour, and in the end he only said one thing, which was better than just talking nonsense."

With this model, Han Jidong was even more powerful.

Ignoring his severe cold, he grabbed a stack of documents and rushed to Urumqi.

In the airline's office, the marketing manager said, "Mr. Han, it's not that we don't want to fly, but the passenger traffic in Shihezi... we lose money every time we fly there."

Han Jidong's nose was still stuffy, and his voice was muffled: "Manager Li, you only counted the passengers, not the cargo."

What are the prices for dried apricots, walnuts, and cotton from Xinjiang when transported to inland China?

What is the demand for electronic products and light industrial goods shipped from the mainland on the return trip?

He pushed Zhai Yang's model over, saying, "We've calculated that passenger and freight combined transport should break even."

I contacted three different airlines, and they all raised similar questions.

Undeterred, Han Jidong continued his journey to Beijing while taking medication as his cold worsened.

He waited in the corridor of the Civil Aviation Administration of China in Beijing for two whole days before finally waiting for his supervisor.

After reviewing the materials, the leader pondered for a moment: "The data model is somewhat convincing, but it is, after all, a prediction..."

"If you can secure sufficient funding to reduce operational risks, we can consider approving a few pilot routes first."

Financial security?

Han Jidong's mind raced.

Shihezi is facing a financial crisis, and Lao Wang's side has already reached its limit...

Just then, he remembered the chairman of Dalian Airport Group.

After making a phone call and listening to the whole thing, the chairman remained silent for a while and said, "Ji Dong, you have guts in this matter."

"That's great, our Dalian Airport happens to have quotas for aid projects in Xinjiang, I'll help you get them!"

A week later, Dalian Airport faxed a letter of intent for 30 million yuan in aid funds to the Shihezi Airport office, specifically for risk mitigation in the development of new routes.

Old Wang held the letter of intent, his hands trembling slightly: "President Han... is this... is this for real?"

"In black and white."

Han Jidong coughed twice and said in a hoarse voice, "Now, can we submit the application for approval?"

With funding secured, the Civil Aviation Administration's approval process finally eased.

The first batch of five routes has been finalized: three within Xinjiang—Kashgar, Hotan, and Yining; and two outside Xinjiang—Dalian and Qingdao.

When the news reached Shihezi, the entire airport was in an uproar. Fruit farmers spread the word, and entrepreneurs were eager to make a big splash.

However, just seven days before the maiden flight, a bolt from the blue struck.

The first partner airline, which was originally scheduled to operate the flight, suddenly sent a letter stating that due to rising international oil prices and increased operating costs, it requested a 20% increase in the originally agreed price, otherwise it would "regretfully have to terminate the cooperation."

"This is price gouging!"

Old Wang smashed his cup in anger. "The flight route was approved, the advertising was done, and hundreds of tickets have already been pre-sold. And now they're pulling this stunt?"

What does a 20% increase mean?

This means that the nascent financial model has completely collapsed, and the new route is destined to lose money before it even takes off.

The conference room was deathly silent.

Everyone knows that if a new airline cannot be found, all previous efforts will be in vain.

"I...I might have a way."

A timid voice rang out.

Everyone looked over and saw Zhai Yang.

"My father had acquaintances at Shandong Airlines before he passed away."

He used to have a good relationship with a vice president there when he was a freight driver. I can give it a try…

"Contact them immediately!" Han Jidong made a decisive decision.

Zhai Yang ran to the corridor to make a phone call, and everyone listened with bated breath.

You could vaguely hear his voice, sometimes urgent, sometimes pleading.

Twenty minutes later, Zhai Yang returned with red eyes: "I made contact, but the other party is very hesitant..."

After all, time was too tight, and aircraft allocation and crew scheduling were all problems.

"What are their conditions?" Han Jidong asked, getting straight to the point.

"They said... if long-term cooperation can be guaranteed, especially dedicated line cooperation during the peak cotton transportation season, they would give priority consideration."

Zhai Yang paused for a moment, then said, "That vice president also said... it was because of my father."

Han Jidong immediately dialed Shandong Airlines' number.

Two hours later, an emergency agreement was drafted: Shandong Airlines would temporarily allocate two 737s to operate flights for the first three months of the year;

In return, Shihezi Airport promised to prioritize Shandong Airlines for its peak cotton transport season routes over the next three years.

"Sign!" Han Jidong said without hesitation.

Old Wang opened his mouth as if to say something, but in the end it turned into a sigh: "Let's gamble. We've already gambled so much, one more won't make a difference."