China Airlines Ltd (CAL) shares yesterday gained 1 percent to NT$10.1, despite earnings concerns due to disruption from an unprecedented strike which began at midnight on Thursday.
Turnover of CAL shares yesterday surged to 58.65 million compared with 11.61 million in the previous session, with the price fluctuating within a 3.4 percent band.
The nation’s largest carrier canceled 67 flights departing from Taiwan Taoyuan International Airport and Taipei International Airport (Songshan airport), affecting an estimated 20,000 passengers.
CAL’s cumulative revenue in the first five months dipped 6.39 percent year-on-year to NT$57.24 billion (US$1.76 billion).
The company’s daily revenue is anticipated to dip by between NT$100 million and NT$150 million, with daily earnings to take a NT$20 million hit, Capital Securities Corp said in a client note yesterday.
The strike coincides with the summer peak season for the airline industry and prolonged disruption could lead to a long-term strain on the company’s allocation of human resources, the brokerage said.
The strike could also give rise to concerns about aviation safety, while passengers switching to other airlines could affect CAL’s passenger loads and earnings.
CAL is already facing major challenges of fewer passengers from China after the new government came in power, as well as heightened competition on Japanese routes from low-cost carriers, Capital Securities said.
These challenges are expected to escalate in the second half, the brokerage said.
The company’s market share of Japan-bound flights has fallen from 34 percent to 27 percent, it said.
“Coupled with the strike, China Airline’s [sic] operating outlook during the third quarter peak season is growing increasingly uncertain,” it said.
Newly appointed CAL chairman Ho Nuan-hsuan (何煖軒) said that he does not rule out extending flight cancelations to Tigerair Taiwan flights, a budget airline joint venture established with Singapore’s Tiger Airways.
Ho also promised to implement sweeping changes to the 57-year-old company’s management team, in light of the achievements made in its 20-year history by rival carrier EVA Airways Corp.
Three Taiwanese airlines have prohibited passengers from packing Bluetooth earbuds and their charger cases in checked luggage. EVA Air and Uni Air said that Bluetooth earbuds and charger cases are categorized as portable electronic devices, which should be switched off if they are placed in checked luggage based on international aviation safety regulations. They must not be in standby or sleep mode. However, as charging would continue when earbuds are placed in the charger cases, which would contravene international aviation regulations, their cases must be carried as hand luggage, they said. Tigerair Taiwan said that earbud charger cases are equipped
Foreign travelers entering Taiwan on a short layover via Taiwan Taoyuan International Airport are receiving NT$600 gift vouchers from yesterday, the Tourism Administration said, adding that it hopes the incentive would boost tourism consumption at the airport. The program, which allows travelers holding non-Taiwan passports who enter the country during a layover of up to 24 hours to claim a voucher, aims to promote attractions at the airport, the agency said in a statement on Friday. To participate, travelers must sign up on the campaign Web site, the agency said. They can then present their passport and boarding pass for their connecting international
UNILATERAL MOVES: Officials have raised concerns that Beijing could try to exert economic control over Kinmen in a key development plan next year The Civil Aviation Administration (CAA) yesterday said that China has so far failed to provide any information about a new airport expected to open next year that is less than 10km from a Taiwanese airport, raising flight safety concerns. Xiamen Xiangan International Airport is only about 3km at its closest point from the islands in Kinmen County — the scene of on-off fighting during the Cold War — and construction work can be seen and heard clearly from the Taiwan side. In a written statement sent to Reuters, the CAA said that airports close to each other need detailed advanced
Tropical Storm Fung-Wong would likely strengthen into a typhoon later today as it continues moving westward across the Pacific before heading in Taiwan’s direction next week, the Central Weather Administration (CWA) said. As of 8am, Fung-Wong was about 2,190km east-southeast of Cape Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, moving westward at 25kph and possibly accelerating to 31kph, CWA data showed. The tropical storm is currently over waters east of the Philippines and still far from Taiwan, CWA forecaster Tseng Chao-cheng (曾昭誠) said, adding that it could likely strengthen into a typhoon later in the day. It is forecast to reach the South China Sea
RSS