China’s three largest carriers – Air China, China Eastern Airlines and China Southern Airlines – expect to prolong their post-pandemic loss-making streaks for the first half of the year, blaming a raft of economic and geopolitical challenges.
Of the three, only China Southern is expecting a steeper loss for the half-year: between CNY1.34 billion and CNY1.76 billion ($187-246 million), compared with a net loss of CNY1.2 billion in the same period last year.
In contrast, Air China and China Eastern are expected to significantly narrow their losses for the half-year. Beijing-based Air China forecasts a net loss of between CNY1.7 billion and CNY2.2 billion, compared with 2024’s half-year net loss of nearly CNY2.8 billion.
Meanwhile, China Eastern expects a net loss of CNY1.2-1.6 billion, down from the CNY2.8 billion loss posted last year.
The ‘Big Three’ raised several key challenges for their financial forecasts, despite seeing “sound growth” in their domestic operations.
Air China notes that while it “intensified efforts” to improve its operations – such as enhancing aircraft utilisation and strict cost controls — it was still impacted by other challenges, including a “downward shift in passenger demographics” and “deepening uncertainties” in global geopolitics.
Echoing this sentiment, China Southern flagged the “sluggishness of the global supply chain” and the “increase in unstable and uncertain factors in the international environment” among reasons for its losses.
China Eastern points out two key factors: “fierce price competition” among domestic operators, as well as a “complex and volatile international environment”.
This is despite “positive momentum” in its domestic network and an international expansion to “emerging markets”, as well as efforts to strengthen cost management.
The three carriers are among the few global operators to remain in the red in their post-pandemic earnings. In past results, the ‘Big Three’ blamed an imbalance in domestic and international recovery, as well as competition, for their losses.
