Air passenger traffic returns to 70% of full strength in China
PASSENGER loads at China’s top three airlines are rebounding as travel picks up again, boosted by people flying back to their hometowns for the Chinese New Year holidays and celebrating the chance to reunite with families and friends after nearly three years of Covid restrictions.
China Southern Airlines filled 72.7 per cent of its seats in January, the highest passenger load factor among the trio, exchange filings show. That was up from 63 per cent a year ago. Air China was next, with a passenger load factor of 69.9 per cent for the month, followed by China Eastern Airlines, at 68.3 per cent.
Passenger load factor is the percentage of seats that have been filled on a plane and is an indicator of profitability.
The nation’s largest three carriers lost 190 billion yuan (S$37 billion) over the last three years as Covid upended travel, company filings showed last month. Losses accelerated in 2022 when authorities persisted with lockdowns and mandatory quarantine to contain the virus, even as the rest of the world moved on and reopened.
In addition to the disruption caused by the pandemic, the Chinese airlines said they were affected by high oil prices and a weaker yuan, which dropped about 8 per cent against the dollar last year.
Caixin recently said that several state-owned airlines had been criticised by Beijing for offering cut-price tickets in order to fill seats. The Civil Aviation Administration of China (CAAC), which denied that charge, has in the past imposed restrictions on cheap tickets, in 2021 saying it wanted to avoid malicious competition that may cause “cabbage prices”.
A CAAC official said last month that China expects the number of international flights to rebound to between 15 per cent and 25 per cent of levels before the pandemic by the end of March.
The recovery in international flights is slower than for domestic services, due to the longer time needed by airlines to arrange capacity and restart routes, and the reluctance of some passengers to travel abroad, the CAAC official Liang Nan said.
International flight passenger traffic improved in January, the Shanghai Securities News reported on Thursday. As of Feb 6, for example, China Eastern was operating 52 international routes with 302 flights weekly. That will rise to 60 routes and 410 weekly flights by Feb 28. BLOOMBERG
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