Can Chinese carriers build on domestic strength to make international recovery? - Flightglobal

In their traffic results for October, China’s three largest carriers announced something few might have imagined half a year ago, when the country was in the throes of the coronavirus outbreak.

The ‘Big Three’ — Air China, China Eastern Airlines and China Southern Airlines — each announced new domestic route launches.

China Eastern generic

What made it more significant for the carriers was that it was announced in piecemeal fashion; instead, each of the carriers rolled out more than 10 new routes, many of them between second and third-tier Chinese cities.

Indeed, the announcements of October underscore the rapid domestic recovery seen by the Chinese airline industry — one that has been helped by the Chinese government’s ability so far to keep the virus under control.

It is also a strange juxtaposition against the gloom other carriers in Asia and around the world are experiencing, as they hunker down amid a pandemic-driven downturn.

But while the carriers have more or less secured domestic recovery — and then some — their international traffic figures still remain woefully depressed, thanks to the travel restrictions to curb the spread of the coronavirus.

It is a trend that is likely to continue into 2021, as countries battle fresh outbreaks and borders remain closed.

For Chinese carriers, however, they will enter the new year in better financial state than most of their competition, having had the advantage of strong domestic growth in the second half of 2020.

Indeed, a HSBC Global Research report in November underscores the sentiment, stating that Chinese carriers are best poised to recapture lost international capacity when borders reopen, while their competitors languish in shaky financial state.

The HSBC researchers also note that what could also be in Chinese carriers’