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China Fund News reporter Yishan

On the evening of July 15,Air China, China Eastern Airlines, China Southern Airlines, HNA Holdings, Spring Airlines, Juneyao Airlines, etc.Six listed airlines collectively disclosed their operating data for June.

Data shows that with the continued recovery of the domestic economy and the continuous pick-up in civil aviation travel demand, the main operating indicators of major airlines have all shown a positive recovery trend.

Key operating indicators continue to recover

In June, the main operating indicators of major airlines all increased compared with the same period last year.

Data shows that the passenger turnover of Air China, China Eastern Airlines, China Southern Airlines, Spring Airlines and Juneyao Airlines in June increased by 22.6%, 27.73%, 17.97%, 14.34% and 10.15% year-on-year respectively. Among them, China Eastern Airlines' passenger turnover reached 109.09% of the same period in 2019. HNA Holdings' passenger transport volume in June increased by 4.62% year-on-year.

In terms of overall passenger load factor, Air China, China Eastern Airlines, China Southern Airlines, HNA Holdings, Spring Airlines, and Juneyao Airlines were 80%, 83.44%, 83.36%, 83.45%, 92.72%, and 84.99%, respectively, up 7.3, 7.49, 3.89, 0.7, 2.58, and 1.48 percentage points year-on-year, respectively.

On the supply side, all major airlines have increased their passenger capacity investment to varying degrees. The passenger capacity investment (measured in available seat kilometers) of Air China, China Eastern Airlines, China Southern Airlines, HNA Holdings, Spring Airlines, and Juneyao Airlines increased by 11.4%, 16.27%, 12.47%, 9.18%, 11.15%, and 8.24% year-on-year, respectively.

Among them, China Eastern Airlines' passenger transport capacity in June reached 108.24% of the same period in 2019. The company said that as my country's civil aviation is about to usher in the summer peak season, the travel needs of business, tourism, and student holidays are superimposed, and air passenger traffic is expected to increase significantly. The company will actively plan the peak season capacity production in July and August based on the characteristics of the summer market.

In addition, driven by visa facilitation and visa-free policies this year, international passenger-related indicators of various airlines have shown strong growth momentum.

For example, Air China's international passenger capacity increased by 85.1% year-on-year, passenger turnover increased by 114.7% year-on-year, and the load factor increased by 10.5 percentage points year-on-year; Juneyao Airlines' international passenger capacity increased by 127.10% year-on-year, passenger turnover increased by 142.43% year-on-year, and the load factor increased by 4.95 percentage points year-on-year.

China Eastern Airlines revealed that the company's passenger capacity investment in the international market in June has recovered to 95.10% of the same period in 2019, and its capacity investment in the European, Southeast Asian and Australian markets has recovered to 135.24%, 131.71% and 130.53% of the same period in 2019 respectively.

Summer travel season is approaching

Industry expectations are generally optimistic

Recently, many airlines have announced their mid-term performance forecasts for 2024. Among them, Air China, China Eastern Airlines, China Southern Airlines, and HNA Holdings all expect to reduce losses, China Express Airlines expects to turn losses around, and Spring Airlines and Juneyao Airlines expect to increase their performance significantly.

Many airlines said that the global economy will recover slowly in the first half of 2024, and the domestic economy will continue to pick up, driving the overall demand in the aviation market to improve. The main reasons for the losses during the reporting period include that international routes have not yet fully recovered, intensified domestic market competition, and high jet fuel prices.

Data released by the Civil Aviation Administration of China recently showed that in the first half of 2024, the civil aviation industry completed a total transport turnover of 70.3 billion ton-kilometers, a year-on-year increase of 32.2%; the industry completed a total passenger transport volume of 350 million, a year-on-year increase of 23.5%.

With the arrival of the summer travel peak season, air transport capacity is expected to continue to grow, and the industry is generally optimistic about demand expectations.

According to a research report by Guotai Junan Securities, the peak of summer travel is expected to arrive in late July and is expected to last until mid-August. In 2023, airlines' profits generally hit a record high during the summer travel season. In 2024, the summer travel season may once again verify the aviation logic that the ticket price center and profit center will rise after supply and demand recover.

Huayuan Securities also said that the current focus is on the performance of volume and price during the peak summer season, and in the medium term, it is optimistic about the improvement of the industry's competitive landscape and the elasticity of airline performance under the continued realization of supply and demand logic. In this round of aviation cycle, the slow growth of industry supply is highly certain, entry and exit policies continue to support, international routes are recovering, and domestic demand is expected to pick up, and ticket price elasticity is expected to be released.

Editor: Captain

Review: Xu Wen

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