China's three largest airlines, Air China, China Eastern Airlines, and China Southern Airlines, have reported combined first-half net losses of approximately 8.2 billion yuan (£901 million). This marks the seventh consecutive year of first-half losses for the carriers, attributed to surging jet fuel prices and a subdued summer travel period.
Individual losses saw Air China report 2.3 billion yuan, China Eastern Airlines 2.2 billion yuan, and China Southern Airlines 3.7 billion yuan. These figures represent a widening of losses compared to the same period in the previous year. The airlines' fuel costs rose between 35 and 38 per cent in the first half, with China Southern stating there are currently "no effective means available" to manage its exposure to price fluctuations.
Despite strong revenue growth driven by international demand, particularly on European routes, weaker economic conditions and competition from high-speed rail have limited the airlines' ability to increase domestic fares. The third quarter, typically profitable, has offered little relief due to an unusually strong typhoon season disrupting domestic routes. HSBC analysts now forecast combined losses of approximately 16.8 billion yuan for the three carriers in 2026.