China Southern Airlines Sees Its Profit Falling

News in Asia
China Southern Airlines Sees Its Profit Falling

China Southern Airlines, one of China's Big Three airlines alongside Air China and China Eastern Airlines, saw its profit falling by half due to high oil prices and increades competition.

The net profit of the airline fell by more than a half last year. The airline names high oil prices, the Chinese currency weakness and a stronger competition the main factors that influenced  its financial results. Another major reason for the decline is the rapid expansion of China’s high-speed rail network.

The carrier is based in Guangzhou, the major airport of Guangzhou, the capital of Guangdong province, China. Guangzhou Baiyun International Airport is China's third busiest airport by passenger traffic handling over 65 million passengers a year. The airline runs over 800 passenger and cargo aircraft. Every day, the airline operates more than 2,000 flights to over 200 destinations worldwide. Since January, 1, 2019, it quit Sky Team Alliance to start a frequent flyer program partnership with American Airlines in March 2019.

China Southern blamed the US-China trade war for exchange rate depreciation and fluctuations in global crude oil prices, which were the main drags on its business. The tendency will most probably persist the next year, too.

The airline also suffers from increased competition with the China Railway Corporation, with the airline routes often overlapping with the railway network.

Source

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