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2010 could be a big year for Chinese airlines as traffic booms. Will they look to invest abroad?


China’s economy is booming again and oil prices are around half their peak 2008 levels. For Chinese airlines, it’s a pretty simple equation, with pent-up demand expected to provide very strong traffic growth again in 2010 after surprisingly strong growth last year (particularly in the second half). As a result, airline industry profits should flow again in 2010 after a recovery in earnings in 2H2009. Chinese aviation is bullish again, growing capacity aggressively (taking delivery of almost one in two aircraft bound for Asia Pacific airlines in 2009 – a proportion it will repeat in 2010 and 2011) and – crucially – looking to further consolidate at home. And will expansion mean foreign airline acquisitions, just as China’s wealth funds are buying into foreign resources? [1760 words]

Unlock the following content in this report:


  • Pulling out of the 2008 nose dive
  • Tide rolls back in second half of 2009
  • Airline traffic well above forecasts in 2009
  • Airports also have a solid year
  • 2010 could be very strong: pent-up demand
  • Around 200 more aircraft to be added this year, few retirements
  • Overheating a concern
  • CAAC encourages consolidation - and foreign investment?

Graphs and data:

  • Chinese mainland carriers’ passenger numbers and cargo volume growth: 2005 to 2009
  • Chinese major carriers’ passenger numbers and growth: 2009
  • Chinese airports passenger numbers and passenger numbers growth in 2009: (Annual pax over 5 million airports)
  • Chinese mainland carriers’ passenger numbers and growth: 2003 to 2009
  • Chinese mainland carriers’ cargo volume and cargo volume growth: 2003 to 2009
  • Chinese airline annual aircraft deliveries and % of total Asia Pacific deliveries: 2007 to 2011F
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