China's major airlines including Air China, China Southern Airlines e China Eastern Airlines, reported losses in the first half of the year. Although they had made profits in 2019, before the pandemic, they are now struggling with the slow recovery of international travel, oversupply in the domestic market and increased global competition.
China's flagship airline, Air China, reported a net loss of 2,78 billion yuan ($392 million) in the first half of this year, down from the 3,45 billion yuan loss recorded in the same period last year, the company said on Thursday.
A China Southern Airlines Guangzhou China Airlines Co., Ltd. announced a net loss of 1,23 billion yuan in the first half, narrower than the 2,9 billion yuan recorded in the same period last year. The Guangzhou carrier posted a profit of 760 million yuan in the first quarter.
In the first semester, the Air China has seen growth in international traffic, reaching more than 80% of 2019 levels. However, its routes to North America are recovering slowly, with flights between China and the United States reduced to approximately 20% of 2019 levels, due to political issues and low demand.
“As international routes are not fully resumed, wide-body aircraft are used domestically, intensifying the oversupply”, declared the Air China.
A China EasternShanghai-based China Airlines will release its interim results on Friday, forecasting a loss of up to 2,9 billion yuan in the first half. Despite growth in China’s outbound traffic since the end of pandemic restrictions in early 2023, the recovery in international travel is not meeting expectations due to the economic downturn and a surge in domestic travel.
In July, China saw a 23% decrease in international flights compared to the same month in 2019, and a 15% increase in domestic flights, according to data from cirium. Despite this, Chinese airlines are expanding their presence in the international market relative to their international rivals.
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