The Mainland Affairs Council (MAC), Taiwan's top agency for cross-strait policy, responded this week to criticism from China's Taiwan Affairs Office, which cited high passenger load factors as evidence that Taiwan should lift "unreasonable restrictions" on air travel.

MAC Deputy Minister Liang Wen-chieh (梁文傑) countered that airlines are profit-driven entities, not policy tools. He challenged Beijing to apply its own rhetoric about "market principles" by lifting bans on Chinese students studying in Taiwan.

The Profitability Standoff

Currently, airlines operate 307 weekly flights to 15 destinations in China. While TAO spokesperson Zhu Fenglian (朱鳳蓮) argued that load factors nearing 80 percent justify a return to pre-pandemic levels—when 890 weekly flights served 61 cities—Liang noted that carriers are not even using their current full allotment.

Under existing agreements, airlines are authorized to fly up to 420 weekly flights. The fact that they operate only 307 indicates that carriers lack the financial incentive to add more. （Related： Taiwan's Power Problem: How Energy Constraints Could Undermine AI Ambitions ｜ Latest ）

"China Airlines and EVA Air won't leave money on the table," Liang said. "If there were a fixed source of customers or tour groups—giving carriers a reliable baseline as in the past—we wouldn't be seeing just 307 flights."

Charter Flights: A Zero-Application Reality

To illustrate the lack of market depth, Liang pointed to the 13 additional Chinese cities Taiwan opened for charter flights in March 2023. These destinations, which include business hubs like Wuxi, Changsha, and Tianjin, were categorized as having potential demand but insufficient volume for regular scheduled service.

Since the policy changed nearly two years ago, not a single airline has applied to fly a charter to any of these 13 cities—even during the peak Lunar New Year travel period.

"Why did we say there was demand but not the conditions?" Liang asked.

"Because while Taiwanese businessmen in these areas express needs... reliance solely on business travel does not guarantee sufficient volume."

Let the Market Decide

The dispute has devolved into a rhetorical stalemate. Beijing insists Taiwan must open routes before tourism talks can begin. Taipei argues that without guaranteed tourist groups, opening routes is commercially unviable. （Related： Taiwan's Power Problem: How Energy Constraints Could Undermine AI Ambitions ｜ Latest ）

Liang seized on Beijing's demand to "let the market decide," turning the argument back on Beijing's restrictions on students. In 2017, nearly 10,000 Chinese students studied in Taiwan; today, that number has plummeted due to the Chinese government's ban.

"If we are letting the market decide, I very much hope the other side will open up for mainland students to come to Taiwan," Liang said. "Why not let the market decide and open it up to see how many students want to come?"

Managing Expectations

​Liang also pushed back against complaints regarding the inconvenience of transfers, comparing cross-strait travel to long-haul international routes. He noted that just as travelers fly to hubs like Frankfurt or Vienna to reach secondary European cities, travelers to China can transfer via major hubs like Shanghai or Beijing.

"No one complains about this situation," Liang said. "These are market decisions."

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Original Article in Chinese