China’s three largest airlines enjoy rebound in Q3
CHINA’S three largest airlines, boosted by the recovery of the domestic travel market, all returned to profitability in the third quarter.
Now they are also looking for more traction abroad, including one offering an eye-popping, all-you-can-fly deal to help revive international demand.
China Southern Airlines saw a net profit of 4.2 billion yuan (S$793.3 million) in the quarter, compared with a net loss of 6.1 billion yuan a year earlier. Shanghai-based China Eastern Airlines said its profit was 3.6 billion yuan, versus a year-ago loss of 9.4 billion yuan. Flag carrier Air China’s net profit of 4.2 billion yuan followed a loss of 8.7 billion yuan in the same quarter last year.
All three were still reporting losses halfway through 2023.
They collectively pointed to the recovery of the passenger market – with more travellers and higher prices – as the main reason for the turnaround.
“Boosted by the increase both in passenger load factor and airfares, the company substantially reduced losses and increased profits in the quarter,” Beijing-based Air China said in a stock exchange filing.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
The Chinese market saw strong demand in Q3, which encompasses the peak summer travel season and the Golden Week holiday that started at the end of September. A record 180 million trips were made during the three months, representing growth of 108 per cent from a year earlier.
Numbers were also 2.6 per cent higher than the same period in 2019, according to the Civil Aviation Administration of China (CAAC).
An increase in demand for international flights during the remainder of the year would be a boost, as recovery rates have lagged the growing domestic market.
A total of 16,680 weekly international flights by 150 carriers have been approved for the winter to spring season, which started on Sunday (Oct 29), including cargo flights, according to the CAAC. The approval covers 13,004 weekly passenger flights – about 71 per cent of the 2019 level. According to the regulator, international passenger flights have stayed at more than 50 per cent of the 2019 level recently.
With more capacity added to overseas routes, carriers are turning to sales promotions. Guangzhou-based China Southern recently announced an all-you-can-fly offer for the winter to spring season, giving customers unlimited flights to destinations mainly in Asia, including Tokyo and Bangkok, for as little as 1,999 yuan.
The deal, which is valid from November to the end of February, is intended to help bring in business during a typically slower season for air travel. BLOOMBERG
Share with us your feedback on BT's products and services
