Juneyao Airlines

Juneyao Airlines and Spring Airlines to use IPOs to grow fleets and expand the LCC model in China

In a country with a very small LCC penetration rate – 3.5% internationally and 6.1% domestically in FY2011 – Spring Airlines, and Juneyao Airlines to a lesser degree, have shown success is possible in China's heavily regulated market that favours the larger, state-owned ‘Big Three’ carriers. While challenges exist, the potential is huge for the nation's LCC market.

LCCs first entered the China market in 2005, with Spring Airlines, Juneyao and Okay Airways all launching operations with the low-cost model, although in less than eight months, Tianjin-based Okay Airways gave up the model. Spring Airlines in particular has had considerably success in carving out a niche, with the carrier maintaining industry-leading load factors and reporting consistent profitability, often while the state-owned carriers have reported losses. Spring and Juneyao are now looking towards their next phase of expansion and both are planning to launch IPOs in 2012 to help fund continued fleet and network expansion. 

China’s second tier carriers reporting improved financial results in 2010

China’s second-tier carriers, Hainan Airlines, Shandong Airlines, Xiamen Airlines, Spring Airlines and Juneyao, all reported improved financial results in 2010, based on Chinese Accounting Standards. All of them are aiming to continue to expand their profitability and presence in the Chinese market.

China Air Show: China welcomes C919 to the world; manufacturers reaffirm committment to China market

China International Aviation & Aerospace Exhibition (Airshow China) was held on 16/21-Nov-2010 in Zhuhai and showcased the rise of China’s civil aircraft manufacturer and also the growing importance of the Chinese civil aviation industry to international manufacturers and suppliers. A breakthrough for the event was rising domestic participation with Commercial Aircraft Corporation of China (COMAC) having a stand at Airshow for the first time. COMAC's C919 was the big news of the Airshow, racking up orders for 100 aircraft.

Chinese airline fleet to DOUBLE to 5,000 by 2015 - CAAC

The CAAC has come out with an extraordinary prediction this month: Chinese airlines will nearly double their fleet size to as many as 5,000 aircraft by 2015. In the shadows of a major international air show on home soil, one might expect some bullish sentiment from the hosts. But the comment, by CAAC Head Li Jiaxiang, that the nation's domestic carriers will have an expected combined fleet of 4,800-5,000 aircraft in just five years (from 2,600 at present) is a breathtaking assessment. Even if it's only 50% accurate, aircraft manufacturers big and small are in for a bonanza.

Profits surge for China’s airlines - a “golden period” ahead

Chinese airline profitability continues to soar in 2010, reflecting the local economic boom, a rebound in air travel demand and a strong yuan. The Chinese airline traffic and earnings outlook is similarly robust, prompting observations from some industry participants that Chinese aviation is entering a "golden" era.

More than 30 airlines consider IPOs as market improves

There are more than 30 airlines around the world that have publicly talked about tapping equity markets to help diversify funding sources, coinciding with an improved economic environment. Aircraft deliveries are also accelerating, with more than 1,300 aircraft scheduled for delivery this year alone, prompting the need for additional financing.