ASIAN AIR CARGO SUPPLEMENT – Air China drives industry recovery

The Chinese commercial aviation industry appeared to post a signifi cant turnaround in 2006 with a collective net profi t of CNY2.38 billion ($311 million) compared with a CNY1.35 billion loss in 2005, ATWOnline reported. However, that reversal, outlined in the recently released CAAC annual report, largely was a result of Air China’s success. The […]


The Chinese commercial aviation industry appeared to post a signifi cant turnaround in 2006 with a collective net profi t of CNY2.38 billion ($311 million) compared with a CNY1.35 billion loss in 2005, ATWOnline reported. However, that reversal, outlined in the recently released CAAC annual report, largely was a result of Air China’s success. The Beijing carrier reported a CNY3.19 billion net last year, which helped boost the industry back toward 2004 profi t levels.

Combined industry revenue climbed 18.4 percent to CNY158.9 billion against a 19.4% lift in expenses to CNY135.7 billion. China’s airlines enjoyed a 15.5 percent year-over-year rise in passengers to 160 million and a 13.9 percent gain in cargo to 3.49 million tonnes.

In 2004, China’s commercial carriers posted net earnings of CNY6.23 billion, accounting for 71.7 percent of the profi t generated by the country’s entire air transport industry. But that ratio slipped to 34.7 percent in 2006, a drop that industry analysts attributed to increased competition, the monopoly position held by airports and oil companies overcharging for their services.

Carriers improved on their firstquarter performance as well, reporting a combined net loss of CNY820 million that narrowed from a CNY2.14 billion defi cit in the year-ago quarter. Citing robust market demand and CAAC’s deepening reforms, analysts have forecast an industrywide net profi t of CNY4 billion in 2007.