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China Aviation Industry Newsletter 4 September

China Aviation Industry Newsletter 4 September

BOC Aviation Reports 1H 2017 Performance

BOC Aviation announced its unaudited results for the six months ended 30 June 2017. Robert Martin, Managing Director and Chief Executive Officer, said: “BOC Aviation delivered an excellent result in the first half of 2017, earning a net profit after tax of US$240 million, up 13% compared with the same period last year. The net book value of aircraft, including assets held for sale, increased 25% compared with the first half of last year, to US$12.1 billion, reflecting our investment activities since our initial public offering in June 2016.” BOC Aviation has portfolio of 297 owned and managed aircraft and an orderbook of 196* aircraft scheduled for delivery over the period from 1 July 2017 to 2021.

Brazil and China sign protocols on Chinese investment in Brazilian airports

Brazil’s Ministry of Transports Ports and Civil Aviation announced 1 September Brazil signed several protocols with China on investments in Brazil. Minister Mauricio Quintella said China President Xi Jinping ensured support to Chinese parties seeking to invest in Brazil.

CALC Delivers One Airbus A321 Aircraft to Tianjin Airlines

CALC announced 29 August that it has delivered a new Airbus A321-200CEO aircraft to Tianjin Airlines. The aircraft is custom-painted for the 13th National Games of the People’s Republic of China unveiled in Tianjin on 27 August, featuring the games’ emblem and mascot.

China Eastern to add 191 jets by end of 2019

China Eastern Airlines expects to add 191 aircraft to the group’s fleet by the end of 2019. As at 30 June, the group operated a fleet of 583 passenger aircraft with an average age of 5.53 years

China’s Chongqing Airport begins third terminal, runway operations

Chongqing Jiangbei International Airport began operations from a newly built third terminal and third runway on the 29 August. The 530,000 sq m terminal, which began construction in August 2012, can handle an annual capacity of 45 million passengers, 1.1 million tonnes of cargo and 373,000 aircraft movements.  It has also added 94 aircraft parking stands.

Embraer: Demand for regional jets to surge

China will need 1,070 regional jets with 70 to 130 seats over the next 20 years, making it the third-largest regional aviation market after the United States and Europe. According to the latest report released by Embraer from 2017 to 2036, demand for regional jets in China will account for 17% of the total. Last year, there were 137 such aircraft in operation in China, said Embraer. “In the next decade, the number of middle-class families in China is expected to grow to 300 million from 100 million, and most of them will come from second- and third-tier cities. The urbanization in smaller Chinese cities is expected to drive their demand for aviation transportation,” said Arjan Meijer, chief commercial officer of Embraer.

IATA: Weaker dollar is helping non-US airlines manage fuel increases, with the exception of China

IATA reported 1 September world oil and jet fuel prices rose 60% since their low in Jan-2016. This, along with labour and MRO costs, has been a key factor underpinning the general increase in airline operating costs over the past 12 to 18 months. Conversely, the modest fall in the value of the CNY against the USD since Jan-2016 has meant that fuel prices rose by 66%.

Rebounding global economy pushes up yields at Air China Cargo

With global trade driving up demand for air cargo along its major trade routes, Air China Cargo reported an increase in yields by 13 percent, year-over-year, for the first half of 2017, to reach US$0.19 per revenue tonne kilometer (RTK). Volumes were up 6 percent, y-o-year, at 3.5 billion RTKs, becoming the latest among Asian carriers, after EVA Air and China Airlines, to report improving yields.

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