Taiwan's flagship carrier China Airlines said Thursday it could return to profitability by the end of the year, beating forecasts, helped by strong demand for its recently added direct flights to China.
The airline with a fleet of 46 passenger and 20 cargo aircraft is losing money and isn't sure of when it will be profitable, but its Taiwan-China flights, 10 percent of business, have made money as the global economy shows signs of a rebound, company Chairman Philip Wei said.
"Flights between Taiwan and mainland China can help our overall performance," Wei said. "The worst of the global downturn has already passed, though the recovery speed is still pretty slow for both passengers and cargo."
China Airlines has seen a pickup this month as it looks forward to the August 31 launch of 55 scheduled direct flights between Taiwan and China. It currently operates 22 flights on a charter basis.
"Things have improved in August but whether we make money this year overall is hard to predict," Wei said.
China claims sovereignty over self-ruled Taiwan and has threatened to take it by force, if necessary, but trade and transit ties have improved rapidly since Beijing-friendly Taiwan President Ma Ying-jeou took office in May 2008.
The first regular direct cross-Strait flights began about a year ago. China and Taiwan agreed in April to allow a total of 270 flights per week, up from the current 108, for all eligible aircraft from August 31.
Wei's outlook comes as airlines around the world have been cutting capacity and jobs to deal with a slump in business and holiday travel, fueled by the global economic downturn and aggravated by the outbreak of H1N1 flu.
The International Air Transport Association forecast in June that global airlines could lose USD$9 billion this year, nearly double its previous estimate.
