IATA: Chinese business confidence contracting, but passenger demand has rebounded solidly

IATA published (25-Jul-2019) its North Asia Regional Briefing for Jul-2019. Key regional highlights include:

• General economic outlook:
  • Chinese business confidence has fallen into territory often associated with contraction, which highlights the challenges for businesses impacted by ongoing trade conflict with the US;
  • Trade tensions remain a common driver of weaker business sentiment in Hong Kong and Taiwan. In addition, Hong Kong's business environment has been impacted by the recent public unrest;
• Passenger travel:
  • Following two months of modest year-on-year growth in Mar-2019 and Apr-2019, passenger demand rebounded solidly in China, with annual growth lifting to 7.6% in May-2019;
  • Of the key international markets in the region, the largest Asia-Europe market remained one of the best performers for May-2019, with RPK volumes up by more than 10%, being overtaken only by the smaller Asia-Southwest Pacific market (up 10.6%);
  • China domestic passenger yields declined 6.6% in May-2019, although the rate of decline has been slowing compared to Mar-2019 (-10.9%) and Apr-2019 (-9.3%);
• Freight:
  • FTKs fell by more than 6% year-on-year in May-2019, partly reflecting the impact of tariffs and trade restrictions in the US-China trade war;
• Aircraft deliveries:
  • The latest data show a reduction in the number of jet aircraft deliveries to Chinese airlines in 2019. Chinese carriers are forecast to take delivery of 47 widebodies and 223 narrowbodies in 2019, compared to 76 widebodies and 338 narrowbodies in 2018. [more - original PR]