19 Jun 2025

#3 June 2025: China Aviation Industry Newsletter

AerDragon Enters into Unsecured Syndicated Loan Facility

AerDragon announced it has successfully entered into a $200 million, three-year debut unsecured syndicated loan facility, reflecting strong investor confidence in its creditworthiness. The transaction, led by China Construction Bank (Asia) Corporation Limited as mandated sole bookrunner, was oversubscribed multiple times, attracting robust interest from a broad syndicate of financing partners. This inaugural unsecured deal marks an important diversification milestone for AerDragon as it expands access to new fundraising channels.

AerDragon Chief Executive Officer, Gang Li said, “We are pleased with the robust response from the loan markets, which underscores market confidence in AerDragon’s business model and growth strategy. This inaugural unsecured syndicated facility allows us to venture deeper into new fundraising channels. We appreciate the support of CCB (Asia) and the syndicate partners.”

China Aircraft Leasing Group Holdings (CALC) Signs Lease Agreement with Uzbekistan Airways for Two Airbus A321neo’s

China Aircraft Leasing Group Holdings (CALC) announced the signing of a lease agreement with Uzbekistan Airways for two Airbus A321neo aircraft, as part of Uzbekistan Airways’ ongoing fleet renewal and expansion programme. The aircraft will be delivered in 2026 from CALC’s direct orderbook with Airbus, further expanding CALC’s global leasing footprint.

CALC President and Chief Commercial Officer, Winnie Liu stated: “We are delighted to deepen our relationship with Uzbekistan Airways. This follow-on agreement reflects CALC’s commitment to delivering tailored solutions that meet the evolving fleet and growth requirements of our airline partners. We look forward to supporting Uzbekistan Airways as it continues to expand and modernize its operations.”

Vietnam Airlines and China Southern Airlines Enter Joint Venture

Vietnam Airlines and China Southern Airlines announced the formation of a joint venture (JV), officially launching on August 1 following regulatory approvals. This JV marks the first such partnership between a Chinese and a Vietnamese airline, paving the way for deeper bilateral cooperation. The agreement will see the two carriers align schedules and codeshare extensively across both networks, enhancing seamless connectivity for passengers traveling between Vietnam and China.

To further simplify passenger transfers, the two airlines have introduced Inter-Airline Through Check-in (IATCI), allowing customers to check in for up to three connecting flight segments at their initial point of departure.

China Southern Airlines Deputy Director General of Commercial Steering Committee, Mr. Zhang Dongsheng said, “In recent years, China Southern Airlines has actively tapped into the aviation markets in countries along the Belt and Road through international bilateral cooperation, establishing a global network of international partnerships. The joint venture with Vietnam Airlines marks a significant step forward in our internationalization strategy. We will build an air bridge between the Guangdong-Hong Kong-Macao Greater Bay Area and Vietnam to facilitate the high-quality alignment of China’s Belt and Road Initiative with Vietnam’s ‘Two Corridors and One Economic Circle’ plan, boosting regional economic, trade and cultural exchanges.”

Acumen’s Take

On AerDragon’s Syndicated Loan Facility:

AerDragon’s oversubscribed unsecured facility marks a key step in diversifying its funding profile, moving beyond secured debt into broader capital markets. The deal reflects increasing global lender confidence in China-based lessors and signals that mainland leasing platforms can now access competitively priced unsecured funding, traditionally dominated by larger global leasing names.

On CALC’s A321neo Lease to Uzbekistan Airways:

CALC’s placement with Uzbekistan Airways highlights its growing presence in developing markets where fleet modernisation remains a priority. With narrowbody replacements accelerating across Central Asia, CALC leverages its strong Airbus orderbook to support emerging national carriers in fleet optimisation while solidifying long-term customer relationships.

On Vietnam Airlines–China Southern JV:

This joint venture sets a precedent for cross-border airline consolidation within Asia. By pooling resources and aligning schedules, both carriers enhance bilateral traffic flows while leveraging regional development initiatives like the Belt and Road. The partnership also reflects broader efforts among Asian carriers to create regional network density without excessive fleet duplication.

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