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Airlines weather downturn

By Xin Dingding (China Daily)
Updated: 2009-12-15 08:08
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Chinese airlines have weathered the financial maelstrom without too much turbulence, with the latest statistics indicating a profitable year for the air transport industry.

By November, the industry, including both airlines and airports, netted total profit of 11.8 billion yuan ($1.73 billion), according to statistics released yesterday by the Civil Aviation Administration of China (CAAC) on its website.

By comparison, the industry had lost 28.2 billion yuan last year and globally, the International Air Transport Association (IATA) has forecast a loss of $11 billion for the industry this year.

"The performance of China's air transport industry is the best in the world," Li Jiaxiang, head of CAAC, told China Central Television.

From January to November, airlines carried a record 210 million passengers, up 19.6 percent from the same period of 2008. Meanwhile, nearly 4 million tons of cargo and mail were handled in the 11 months, up 5.7 percent year-on-year.

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The total air traffic in the period hit 38.65 billion tons-km, up 11.4 percent over last year.

"The domestic market has performed especially well, which is a major factor that sustained growth," said Li Lei, an aviation analyst with CITIC China Securities.

The government's policy support by giving back 4 billion yuan of previously collected fees to airlines and airports, and airlines' gains in fuel hedging, have contributed to the profits, he said.

The CAAC figures also pointed to growth in cargo and mail throughput on international routes. It said cargo and mail throughput has stopped declining for 10 months and increased by 0.2 percent year-on-year in November.

The promising air transport market in China has also propelled many foreign airlines including Lufthansa German Airlines and Continental Airlines to expand their business in China.

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