The state-run China Daily newspaper says total losses by the country's 30-plus airlines in the first half of this year have been cut to ¥820 million ($100 million) - down ¥600 million on the losses for the same period last year.
Citing official figures from the Civil Aviation Administration of China (CAAC), the newspaper says the total numbers of passenger carried rose by 2.6% to 26 million in the half ended 30 June, while 20% more freight was carried.
Although official figures from China are notoriously unreliable, any reported gains are seen as positive for the country's airlines, which suffered badly in 1998 after years of phenomenal growth.
The Asian economic downturn, tough domestic and international competition and over-capacity were all blamed for last year's woes, when only a handful of carriers posted profits and combined losses were said to have totalled ¥6 billion.
The giant China Eastern Airlines is reported to have returned to profitability during the first half of this calendar year, while fellow majors Air China and China Southern Airlines are said to have cut their losses sharply.
A ban on domestic ticket discounting, implemented in January, and a crackdown on "disorderly air ticket sale agents" is credited for the first half improvements. But official reports warn that "it is too early to conclude that government efforts really paid off in breathing new life into the money-losing airlines". They point out that the number of high-yield business class passengers has not increased, and the number of leisure passengers flying to some tourist spots has fallen because of the ban on discounting.
For some time, the CAAC has had China's airline managers on notice that they will be sacked unless improvements are made. The China Daily indicates a softer line may be taken and airlines should operate more independently.
Source: Airline Business
