Loading

Chinese airline rebound not expected until 2013, dragging down global industry profitability

Analysis

Narcissistic would not be an inaccurate description for Chinese carriers earlier in 2012 when they started fretting over slowing growth that on a global scale would still make many carriers envious. As profits fell after demand slowed and fuel and exchange losses went up, the atmosphere was that this was a passing moment as Beijing with all its power - and capital - would create a stimulus in the second half that would boost demand back up.

But for a number of reasons this stimulus has so far been small, with further measures not likely until the end of 2012 at the earliest, making it unlikely for carriers to gain much of a drip-down from it until 2013, even if the larger economy is - officially - feeling it. The early implications of that will be seen when carriers in late Oct-2012 report expected declining 3Q earnings, with early indications that will continue in 4Q. What was once a relative nuance will take on greater proportions globally, dragging down what IATA already expects to be a weak 2012 with global profits of USD4.1 billion and a margin of merely 1.6%.

Read More

This CAPA Analysis Report is 1,666 words.

You must log in to read the rest of this article.

Got an account? Log In

Create a CAPA Account

Get a taste of our expert analysis and research publications by signing up to CAPA Content Lite for free, or unlock full access with CAPA Membership.

InclusionsContent Lite UserCAPA Member
News
Non-Premium Analysis
Premium Analysis
Data Centre
Selected Research Publications

Want More Analysis Like This?

CAPA Membership provides access to all news and analysis on the site, along with access to many areas of our comprehensive databases and toolsets.
Find Out More