Shanghai Airlines post USD$183 million net loss
Friday, 27 March 2009: Shanghai Airlines announced on Wednesday a CNY1.25 billion yuan (USD$183 million) net loss for 2008, representing a second straight year loss.
In 2007, the carrier reported a loss of CNY435.12 million according to Reuters.
The sharp fall in travel demand and substantial increase in operating costs due to the global economic conditions were blamed for the disappointing figure.
The huge loss means the carrier’s shares traded in Shanghai will now face special trading limits, with a daily trading cap of 5 percent in either direction. In keeping with China´s securities trading rules, if the airline doesn’t make a turnaround in 2009, it will be delisted.
If air traffic picks up next month, as forecasted by Shanghai Airline’s chairman Zhou Chi, then the carrier may return to profit in 2009.
Chi said the airline was in talks with Boeing on whether to accept and previous order for a 787 Dreamliner.
He added that the airline was not planning any lay-offs.