Passenger protests in the Chinese aviation industry will result in punishment for the airlines involved, not the passengers, says China’s civil aviation administration. In a statement that can only alarm an industry famous for dissatisfied customers, the administration’s deputy chief, Yang Guoqing says, “We will severely punish airlines which experience aircraft occupations and other incidents as a result of service reasons which originate with the airline.”

Tiger Airways is reporting the first signs that the recent slump in Chinese air traffic will end after the August Olympic Games. CEO Tony Davis says the Singapore-based budget carrier’s bookings for flights to China have suffered from such factors as restricted visa availability. But bookings for flights after the Olympics are coming back quite strongly, he tells Dow Jones newswires.

Qantas no-frills offshoot Jetstar will add more Asian connections to its new hub at Darwin as it seeks to build an international narrowbody budget network. Rival Tiger Airways, meanwhile, says it is dropping its services to Darwin from Melbourne and Singapore, blaming fuel and airport costs but also avoiding a head-to-head fight with Jetstar, at least for the moment. Putting details on a strategy that Qantas foreshadowed in November, Jetstar says it will base three aircraft at Darwin by mid-2009 and up to seven within five years.