Robert Besser
04 May 2025, 01:57 GMT+10
BEIJING, China: China's top airlines are still grounded in red ink, reporting steeper losses for the first quarter as they battle fierce competition, shaky consumer demand, and growing fallout from escalating trade tensions with the United States.
This week, state-run carriers China Southern Airlines, Air China, and China Eastern Airlines all posted widened losses compared to the same period last year, extending their post-pandemic financial woes into a fifth consecutive year.
Air China, the country's flagship airline, reported a net loss of 2.04 billion yuan (US$281 million) for the quarter—down 22 percent from a year ago. China Southern, the country's largest airline by capacity, swung to a net loss of 747 million yuan after turning a profit of 756 million yuan in the same period last year. Meanwhile, China Eastern posted a 995 million yuan loss, a 24 percent decline from the year-earlier figure.
None of the three carriers issued comments alongside their financial disclosures.
The results contrast with the global aviation industry, which rebounded to profitability in 2023, while China's airlines continue to face a range of persistent hurdles. These include sluggish international travel recovery, oversupply in the domestic market, weaker consumer spending, currency depreciation, and strained supply chains.
Aviation data shows that domestic flight capacity has started to dip as airlines gradually resume international routes, and ticket prices have tended to trend downward. However, international capacity is still roughly 20 percent below pre-pandemic levels, with demand dampened by economic uncertainties and geopolitical tensions.
Adding to the turbulence, Chinese authorities acknowledged that the ongoing trade war with Washington has significantly impacted their aviation sector. U.S. tariffs and economic pressures are now viewed as a key factor dragging down growth in both passenger and cargo demand.
Subhas Menon, director general of the Association of Asia Pacific Airlines (AAPA), warned on Tuesday that export-driven Asian economies could see further weakness in air travel and freight in the months ahead.
Earlier this month, Boeing repatriated three aircraft from China, stating that Chinese buyers had refused deliveries due to trade-related constraints.
There may be a short-term lift on the horizon: a five-day holiday starting May 1 is expected to boost domestic travel, with economy ticket prices up 4.4 percent over last year, according to travel platform Flight Master.
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