Transportation Industry

Company Watch - CAAC Civil Aviation Administration of China

AirGuide Business, July 14, 2008

7/14/2008

CAAC reported that Chinese carriers transported 14.2 million passengers in June, down 3.8% from the year-ago month, while cargo traffic declined 0.8% to 321,000 tonnes. 7/15/2008

Chinese carriers experienced declining market demand in June owing to slowing domestic economic growth and the continuing effect of natural disasters, according to CAAC. Passenger numbers fell 3.8% year-over-year to 14.2 million and load factor was down 2.1 points to 72.3%. Daily utilization dropped sharply, falling 10.5% to 8.5 hr. due to route cancellations caused by rising fuel prices. Half-year passenger numbers grew 5.4% to 91.8 million and load factor remained level at 74.1%. Utilization rate fell 6.3% to 9 hr. The fleet numbered 1,192 aircraft as of June 30, an increase of 11 during the month. 7/16/2008

Chinese industry executives have said they expect a pick-up in air traffic again in September, when airport security checks return to normal. Chinese carriers have also raised domestic jet fuel surcharges by up to 50 percent from July 1 to offset pressure from high oil prices. Surcharges for international service will be raised by more than 30 percent from July 10. A dull global economy was also blamed by several airline executives for slowing international air traffic. 7/16/2008

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