In China, the local civil aviation sector has reported making a profit.
It’s worth noting that in this case, the mentioned result is what can be called a kind of event. The Chinese civil aviation industry recorded profit for the first time since 2020. For this reason, the result is not just statistical data, but a positive signal that the Chinese civil aviation industry has left the territory of negative financial indicators after several difficult years. Also, against this background, prospects for a positive result in 2025 are forming, although there is no absolute guarantee of a favorable scenario, at least for the reason that there is always a possibility of some emergency or unforeseen circumstances.
It is also worth noting separately that the Chinese civil aviation area is one of the most affected sectors by the coronavirus pandemic. The mentioned pandemic has become a shock factor with significant consequences of a sensitive nature for the entire economy as a whole, both on a global scale and at the regional level. At the same time, some industries have faced the greatest challenges. Obviously, large-scale restrictive measures, including, among other things, closed borders between countries and a general ban on movement in various formats, could not but be a sensitive blow to the area of civil aviation. For civil aviation, coronavirus is symbolically comparable to a disease that causes paralysis of the body. According to Chinese media, local officials assess the prospects of the mentioned industry through the prism of an optimistic perception.
Data from the Civil Aviation Administration of China (CAAC) Administrator shows that the industry reduced its losses by 20.6 billion yuan ($2.8 billion) last year compared to 2023. An increase in the total volume of traffic was also recorded in 2024. The corresponding indicator increased by 25%.
Also, the Chinese civil aviation sector has already formulated its goals for the current year. In this case, efforts are envisaged to ensure further growth in the profitability of the industry. Another goal of the Chinese civil aviation sector for 2025 is to transport 780 million passengers.
According to official data, losses have been an actual economic reality for the mentioned industry for four years. Negative indicators have formed a difficult period, which has already settled down and, in the opinion of officials, will not happen again in the foreseeable future.
The Chinese sector has seen a critical decrease in flights in the past. It is worth noting that this circumstance of the so-called coronavirus reality was more widespread and sensitive in the international field of activity. Most of the canceled flights relate specifically to flights to other countries. At the same time, domestic transportation has also been significantly affected by restrictive measures related to the coronavirus pandemic. In this context, it is appropriate to mention separately that during the period of the mentioned pandemic, China had some of the most severe restrictions in the world. Against the background of this state of affairs, the economy was weakening, which still has not regained sufficient growth momentum, although it is on an upward trajectory.
It is worth noting that last year, Chinese media published a forecast that predicted that the local civil aviation sector in 2024 would make a kind of transition from the recovery stage after the effects and circumstances of the coronavirus pandemic to a sustainable rise in 2024. Also, in this case, it was separately noted that profit will be the main criterion for evaluating the effectiveness of industry recovery.
Last year, China’s civil aviation sector carried a record 730 million passengers. It is worth noting that industry representatives initially predicted that the corresponding figure would be 690 million passengers. This is a rare case when reality has exceeded expectations.
According to media reports, referring to analysts, the mentioned high figures are associated with a faster recovery in passenger numbers compared to the preliminary forecast. In 2020, amid the outbreak of the coronavirus pandemic, passenger traffic dropped sharply to 400 million passengers. In 2022, the decline in this indicator not only continued but also accelerated. During the corresponding period, passenger traffic in the Chinese civil aviation sector amounted to only 252 million passengers. From the point of view of the indicators typical for an Asian country, this is a very low level.
Financial columnist Wu Xiaobo attributed the improvement in the financial performance of the Chinese civil aviation sector to frequent promotions on airline tickets. According to the expert, the corresponding measures contributed to more travel and boosted occupation rates.
Wu Xiaobo noted that last year in China, air tickets were cheaper than high-speed train tickets. The expert also noted that in the segment of international air transportation, the cost of a round-trip flight from coastal Chinese cities to Japan was only 2,000 yuan.
The official aviation data provider Flight Manager has released information according to which the average cost of economy class fare last year was 767 yuan. This indicator is 12.1% lower than the reading recorded in 2023. Also, figure 2024 is 3.8% lower than the average cost of economy class fare observed in 2019.
It is worth noting that the cheaper air tickets did not prevent the Chinese civil aviation sector from improving its financial results.
CAAC data shows that in 2024, the total number of aviation passengers in China reached 470 million. It is worth clarifying that in this case, those passengers who have made only one flight are taken into account. The mentioned figure is 160 million higher than the reading recorded in 2019.
Representatives of the Chinese civil aviation sector point out that factors such as the steady growth of income and more public holidays continue to drive demand for air travel. The industry also currently expects that the expansion of visa-free entry policy and simplification of transit visa issuance procedures will strengthen the Asian country’s position as a global aviation hub.
At the same time, representatives of the Chinese civil aviation sector note that the industry still has a long way to go before the era of long-term prosperity. It is worth noting that so far the prospects indicate that the mentioned path will not be interrupted, but these are more predictive data than guaranteed circumstances that will surely be realized.
As we have reported earlier, US Airlines Say Goodbye to Difficult Year.
