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How Do China Airlines Make So Much Money  
User currently offlineCFBFrame From United States of America, joined May 2009, 531 posts, RR: 3
Posted (4 years 8 months 5 days 11 hours ago) and read 5001 times:

Last year many of the China airlines were significantly under water in profitability. There were the stories that hedges were impacting profitability negatively, and many of the airlines were hiding behind the China courts and not complying with their legal obligations. They were delaying delivery of cargo a/c (777Fs for China Southern to be specific) because worldwide cargo demand was down significantly, and both domestic and international demand was down.

Now, the stories are centered around the airlines having an increase in domestic demand (despite low yields) and they're on the positive side of the hedges. Air China is increasing capacity with an average load factor of 76%. This story from ATW indicates Air China has made a major turnaround. How does that happen ?

http://www.atwonline.com/news/story.html?storyID=20113

7 replies: All unread, jump to last
 
User currently offlinemogandoCI From , joined Dec 1969, posts, RR:
Reply 1, posted (4 years 8 months 5 days 11 hours ago) and read 5001 times:

minor grammar correction : "Chinese" airlines, since "China Airlines" refers to the Taipei-based carrier specifically

[Edited 2010-04-26 06:24:12]

User currently offlinehuaiwei From Singapore, joined Oct 2008, 1118 posts, RR: 2
Reply 2, posted (4 years 8 months 5 days 11 hours ago) and read 4931 times:

Figures can be deceiving. Air China reports "Passenger boardings rose 14.2% to 41.28 million", but 2008 was a low point for air travel in China, especially for Air China as its base is in PEK and people actually shunned the city during the Olympics period as they anticipated overcrowding.

So because everyone predicted their neighbour would fly there and refused to do so, in the end no one went! 



It's huaiwei...not huawei. I have nothing to do with the PRC! :)
User currently offlineCFBFrame From United States of America, joined May 2009, 531 posts, RR: 3
Reply 3, posted (4 years 8 months 5 days 11 hours ago) and read 4746 times:

Quoting mogandoCI (Reply 1):
minor grammar correction : "Chinese" airlines, since "China Airlines" refers to the Taipei-based carrier specifically

Thanks- should the title be changed?


User currently offlineloalq From Switzerland, joined Jan 2007, 230 posts, RR: 3
Reply 4, posted (4 years 8 months 5 days 10 hours ago) and read 4620 times:

As long as you believe in information provided by state owned chinese companies...


"...this is your captain speaking. We have a small problem. All four engines have stopped."
User currently offlinerutankrd From United Kingdom, joined Sep 2003, 3038 posts, RR: 8
Reply 5, posted (4 years 8 months 5 days 10 hours ago) and read 4502 times:

loaiq

Agreed they are all just regional divisions of the CAAC

Relevant reading in a FT article

http://www.ft.com/cms/s/0/6c9e60bc-35d5-11df-aa43-00144feabdc0.html


User currently offlinehuaiwei From Singapore, joined Oct 2008, 1118 posts, RR: 2
Reply 6, posted (4 years 8 months 5 days 8 hours ago) and read 4194 times:

Quoting loalq (Reply 4):
As long as you believe in information provided by state owned chinese companies...

So why don't they just report stellar profit figures year after year?



It's huaiwei...not huawei. I have nothing to do with the PRC! :)
User currently offlineCFBFrame From United States of America, joined May 2009, 531 posts, RR: 3
Reply 7, posted (4 years 8 months 5 days 8 hours ago) and read 4034 times:

Quoting rutankrd (Reply 5):
Agreed they are all just regional divisions of the CAAC

Relevant reading in a FT article

Man- talk about an industry that's fraught with significant risk!!!

Quoting huaiwei (Reply 6):
So why don't they just report stellar profit figures year after year?

If you don't produce returns, there could be personal risk!!!!


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