China’s big airlines set for fourth straight lossmaking year

China’s three major airlines are on track to extend a lossmaking streak to a fourth year, as analysts warn that the country’s uncertain economic growth and fewer direct US flights are weighing on demand for international travel. The three carriers’ total combined estimated net losses of up to Rmb14.3b ($2b) are significantly less than the combined loss of Rmb108.7b in 2022, according to their preliminary results. But the Chinese airlines are struggling in comparison with US and European carriers, which have been reporting booming profits on a rise in airfares. One year after China lifted its Covid-19 control restrictions, China Eastern Airlines on Tuesday evening said it expected to report a net loss of up to Rmb8.3b for the year ending in December. Last week, Air China forecast a net loss of up to Rmb1.3b for 2023, while China Southern Airlines said it expected to lose as much as Rmb4.7bn in the same period. Weak demand among business travellers and China’s restrictive visa policies have frustrated the post-pandemic rebound, China Eastern said in an exchange filing late on Tuesday. “The overall international routes recovered slower than expected,” the airline said. The carriers are struggling to resume direct flights to the US at a time of increased tension between Beijing and Washington. While the number of international flights recovered to about 70% of 2019 levels as of this month, flights to the US remained at just 18%, said HSBC analysts.<br/>