China’s ‘Big Three’ warn of competition, supply chain as losses set to prolong

China’s three largest operators expect to continue their loss-making streak for 2024, amid a global supply chain crunch, as well as increased domestic competition and slower international recovery. The ‘Big Three’ – comprising Air China, China Eastern Airlines and China Southern Airlines – note in their respective earnings guidances that while overall recovery “gained momentum” in 2024, there were “operating pressures” that remained. Air China discloses a net loss forecast of CNY160 to 240m ($22 to 33m), an improvement from the CNY1b net loss in 2023. The Star Alliance carrier says it “made every effort to enhance efficiency” and “strengthened” yield management, which resulted in an improvement in earnings. Yet, it flags “an increasingly complex and volatile” operating environment, and “intensified” competition in its domestic operations. It is a sentiment echoed by compatriot China Eastern, which also saw “insufficient demand” for business trips on top of stiff competition. The Shanghai-based operator is forecasting a net loss of between CNY3.3 and 4.3b, down from 2023’s CNY8.2b net loss. <br/>