Chinese Airlines Wrestle with Profit Decline Despite Passenger Surge

China's major airlines report profit declines despite record passenger numbers due to domestic economic slowdown. Air China, China Southern, and China Eastern see reduced profits amid lower fares and increased capacity post-pandemic. Economic challenges, including high youth unemployment and property crises, impact consumer spending, affecting the aviation sector.

In a surprising downturn, China's leading state-owned airlines have reported profit declines in the third quarter despite historically high passenger numbers over the summer. The dip in profits comes as domestic economic growth slows, pushing travelers towards cheaper fares, impacting the overall revenue stream.

Air China, headquartered in Beijing, announced a net profit of 4.14 billion yuan ($581.34 million) for the quarter, a slight decrease from a year earlier. Simultaneously, China Eastern Airlines saw a 28.2% year-on-year drop in net profit, highlighting the growing pressure on the aviation industry.

China Southern Airlines, the country's largest airline, noted robust market demand but faced a 23.9% decrease in its third-quarter net profits. This fall is attributed to increased capacity not corresponding with higher earnings, as travelers opt for lower-priced tickets amidst ongoing economic strains.

(With inputs from agencies.)