This will be the first in a series of blog posts explaining the current and future status of China’s airline industry. Part One will focus on an examination of geographical, demographic, and economic factors that differentiate China’s from the rest of the world’s airlines.
The most salient fact about China is the sheer size of its population and arguably just as important, the population density of China. First, it is a fact that one out of every four humans on Earth lives in China. Ranked by land mass, China is the second largest country on Earth, falling well below Russia in area. China is followed in size by the US, Canada, and Brazil, but both the US and Canada have a land mass that is nearly equal to that of China. On the other hand, ranked by population, China comes in as #1 by a very large margin. China has 1.4 billion people. India has 1.3 billion, the US has 327 million, Indonesia has 267 million, and the next largest is Brazil with 211 million. Thus the US with an area the same size as China has less than 1/4th of China’s population.
Another distinguishing feature of China is the distribution of its population within its borders and the concentration of this huge population relative to historic centers. While some countries such as Russia with its Siberian wilderness, Brazil with its Amazon rainforest, and Canada with its Arctic frontier also have vast unpopulated areas, China is unique in that its huge population is packed into its Eastern half. In other words, while Canada’s population is confined to its south, Canada’s population is tiny compared to that of China’s.
An examination of the map above shows that there are three major areas of population concentration. The most important is the region defined by the curved line connecting Beijing (Peking), Qingdao (Tsingtao), Shanghai and Changsha . Highlights of this sector include the capital Beijing, the major coastal cities including the Imperial German colonization of Qingdao (and its Tsingtao beer), and the great Yangtze River, which connects Chongking, Wuhan, Nanjing, and Shanghai. Changsha has enormous historical importance in China, including its early relationship with Mao Zedong. Chongking and Chengdu together form a major central population center. In the South, Guangzhou (also known as Canton) and Hong Kong form a highly important economic center on the world’s stage. Also lying between Guangzhou and Hong Kong is the city of Macau.
For perspective, the straight line distance between Beijing and Hong Kong is 1,236 nautical miles, comparable to Los Angeles-Houston.
But stepping backward with a broader look, if we compare China’s geography and population distribution to that of the US, consider a straight line drawn in the US from Chicago to New Orleans. Then compare that to a line drawn in China from Bautou in the North to Kunming in the South. The great majority of China’s population lies to the east of that Bautou-Kunming line. It is as though the entire population of the US were restricted to the Eastern portion, entirely East of a line from Chicago to New Orleans. Relocate all of the US cities of the Western side to the Eastern side of this line (cities such as Los Angeles, San Francisco, Seattle, Phoenix, and Denver) and then quadruple the population and have all of that in the Eastern side. In the three areas of concentration described above, the population density is between 520 people per square mile to more than 1,000 people per square mile. But that is covering the entirety of very large areas of the country, not just the major cities. (The population density of Metropolitan Los Angeles is 5,300 people per square mile.)
China’s middle class is numerically larger than the middle class of the US (109 million compared to 92 million.) That said, as a percentage of the population, some 11% of all Chinese are considered to be middle class while 50% of the US population is middle class. At the same time, one out of six middle class people in the world live in China. Depending on what is used to “normalize” the economic statistics, China’s economy has already surpassed the economy of the US. and is now #1 in the world. For example, if we normalize GDP to that of the “Purchasing Power” of its citizenry, China beats the US by a wide margin. 
China is developing its infrastructure at a staggering rate, far surpassing anything that the West has ever done or could conceivably do in the future. China is building is rail network such that in three years it will grow from 78,000 km today to more than 120,000 km in length. Sixty percent of that will be electrified. It is building airports at an astonishing rate, basically constructing entirely new large airports (capable of large airline operations) at a rate of eight airports every year. It will build some 800 new general aviation airports (hard-paved) between now and 2020.
China is building a new airport in Beijing, named Daxing, to be the largest international airport in the world, having 7 runways and accommodating 100 million passengers per year. (In comparison, LAX with 4 runways accommodates 63 million per year.)
By 2020, China’s airline industry will be the largest of all the nations in the world, pushing the airline industry of the US into second place, perhaps forever. More about that in Part Two.
 What this means is that the cost of living in China is far less than that of the US. Money earned goes much further.