Sat, Jun 09, 2012 - Page 12 News List

Continuous decline in cargo business hurting CAL, EVA

By Amy Su  /  Staff reporter

Despite steady expansion in the passenger business, continuous weak demand in the cargo sector impacted revenue growth for the nation’s two largest airlines last month.

China Airlines Ltd (CAL, 中華航空), the largest carrier, yesterday reported NT$10.91 billion (US$372.17 million) in revenue last month, up 2.51 percent from a year earlier.

Revenue from its passenger business increased 8.93 percent year-on-year to NT$6.83 billion, but cargo sales fell 9.64 percent from a year ago to NT$3.56 billion due to weaker demand.

On a monthly basis, the airline’s revenue slipped 0.23 percent last month, with the passenger and cargo division posting a 0.15 percent and 3.52 percent decrease respectively.

EVA Airways Corp (EVA, 長榮航空), the second-largest carrier, posted a similar trend, with NT$8.57 billion in revenue, an increase of 0.72 percent from the previous year, company data showed.

Revenue from its passenger business totaled NT$5.07 billion last month, up 9.5 percent from a year earlier, while cargo sales plunged 12.84 percent year-on-year to NT$2.92 billion, EVA said.

Month-on-month, the airline’s revenue rose 0.59 percent last month, with the passenger sector growing 1 percent and the cargo sector dropping 1.02 percent.

Although the air cargo sector continued to post a downtrend in revenue, CAL spokesman Hamilton Liu (劉國芊) said last month that the recent declines in global crude oil prices have made the firm more optimistic about the sector’s business for this year.

This led the airline to decide not to idle more cargo planes in the near-term, Liu added.

However, Capital Securities Corp (群益證券) said in a research report on Monday that passenger business will remain the airlines’ major driver this year, with no sign that the air cargo business will rebound over the near future.

TransAsia Airways Corp (復興航空) posted stronger revenue growth than CAL and EVA.

Revenue for TransAsia totaled NT$796.57 million, up 13.96 percent and 1 percent from a year and a month earlier respectively, company statistics showed.

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