Skip to main content
Best News Website or Mobile Service
WAN-IFRA Digital Media Awards Worldwide
Best News Website or Mobile Service
Digital Media Awards Worldwide
Hamburger Menu




Air China, China Southern stay in the red amid travel controls

BEIJING/SYDNEY : Two of China's biggest airlines posted steep third-quarter losses on Friday as the country's stringent zero-COVID policy reduced domestic demand and kept international flights at a tiny fraction of pre-pandemic levels.

Air China Ltd and China Southern Airlines reported a combined 14.8 billion yuan ($2.04 billion) third-quarter loss, taking their total losses this year to 45.7 billion yuan.

The fourth-quarter outlook remains dim after a lacklustre week-long National Day holiday in October that saw the number of trips fall 18.2 per cent from last year, according to government data.

The government advised citizens to stay put during the holiday, a popular domestic and international travel period before the pandemic, to curb the spread of COVID-19, even though case numbers in China are small by global standards.

Beijing-based Air China, the country's flagship carrier, reported a third-quarter loss of 8.7 billion yuan, narrower than a loss of 10.5 billion yuan in the second quarter when the country experienced major travel disruptions, including a lockdown in Shanghai. Guangzhou-based China Southern Airlines posted a third-quarter loss of 6.1 billion yuan, better than a 7.0 billion yuan loss in the previous quarter.

Rival Shanghai-based China Eastern Airlines is scheduled to report earnings on Sunday.

The three state-owned airlines are resuming some international routes this month after the government in May requested an increase to facilitate travel by staff members at international companies.

The Civil Aviation Administration of China said on Wednesday that international flights would double for the October-March winter schedule season relative to the prior year to 840 one-way flights per week.

Chinese airlines on average flew 35 international flights a day in September, up 24.5 per cent from August, according to aviation data provider Flight Master. However, the international market remains extremely depressed with current flight numbers at around 5 per cent of 2019 levels.

Most of the additional flights were on Asian routes, with long-haul flights to Europe and North America remaining scarce and expensive.

China Eastern said on Oct. 17 that it plans to double weekly international flights to 108 by the end of the month, including the return of routes like Kunming-Bangkok and Hangzhou-Tokyo.

A research note issued by CITIC Securities this month forecast international flights would reach 10 per cent of 2019 levels by end of the year.

($1 = 7.2461 Chinese yuan renminbi)

Source: Reuters


Also worth reading