China Southern Airlines forecasts (13-Apr-2012) a more than 50% year-on-year decline in net profit in 1Q2012 from the CNY1236 million (USD193 million) it reported in 1Q2011 due to “the slowdown in the domestic economic growth and the substantial increase of jet fuel prices”. The carrier also attributes the profit decline to the slowdown in the pace of appreciation of Chinese yuan against the US dollar. [more - original PR]
China Southern issues profit warning for 1Q2012, expects 50% decline in net profit
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China Southern Airlines deflects yield pressure concerns. Long haul focus shifts to North America
China Southern Airlines may be Asia's largest airline, but it has one of the smallest long haul networks. China Southern has shifted growth to international markets, which represented only 17% of capacity in 2009 but doubled to 34% in 2016. Its long haul plank has been Australia and New Zealand, funnelling traffic from around China down to its southern hub at Guangzhou. China Southern has met its objectives for Australia/NZ and now turns its focus to the market that has preoccupied most other Northeast Asian airlines: North America.
China Southern plans to increase flights from five daily to 11 daily, about the size that ANA is today – and larger than Air China and China Eastern. Although China Southern can build on the principle of using Guangzhou as a North-South hub, North America is a radically different proposition. Guangzhou's southern positioning limits exposure to the Chinese market that China Southern knows best. China Southern will need to target connections to Southeast Asia and India, which have only been a small component of Air China and China Eastern's network.
Alitalia: "everyone has to pull in the same direction" – ongoing issues, and viability is at stake.
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