China Eastern Airlines Corp. CEA -6.31% has grown over the past three decades to become one of the world’s biggest carriers by catering to a vast new market of Chinese travelers.
Until this week, its rapid rise—like that of China’s broader aviation industry—had also been largely without safety incidents.
That record was challenged Monday when China Eastern Flight 5735 dropped from the sky and slammed into the mountains of southern China with 132 people on board. The crash was China Eastern’s first since 2004 and abruptly ends the country’s record of 12 years without a deadly air disaster.
The company said it lost contact with the Boeing 737 during its journey from the southwestern city of Kunming to the southern metropolis of Guangzhou, and that it had sent teams to the accident site. China Eastern said the cause of the crash was under investigation and that it would cooperate with the relevant probes.
“The company sends deep condolences to the passengers and crew members lost in the crash,” it said. The company’s website switched to black and white on Monday in a sign of mourning. Rescuers haven’t found any survivors at the crash site, state broadcaster China Central Television said Tuesday morning.
Founded in 1988, China Eastern is one of three big state-owned airlines, together with Air China Ltd. and China Southern Airlines Co. , which dominate Chinese air travel.
Based in Shanghai, China Eastern is the main link between China’s financial capital and other cities both inside and outside the country—a role that has made it a key beneficiary from an explosion in demand for air travel in the country.
Growing from a low base of around 62 million in 2000, China logged 660 million air passenger trips in 2019, as millions of Chinese embraced travel for the first time.
That growth rate had put the country on track to overtake the U.S. as the world’s biggest aviation market by as early as 2022, the International Air Transport Association forecast, before the coronavirus pandemic hit travel demand globally.
China Eastern carried 130.3 million passengers in 2019, making it the world’s eighth busiest airline that year, just behind Germany’s Lufthansa AG and just ahead of the parent company of British Airways. A decade earlier, China Eastern carried 44 million passengers.
Still, passenger numbers have dropped over the past two years amid the pandemic, with China Eastern logging 78.5 million passenger journeys last year. In January, the company said it would likely report a loss of about $2 billion for 2021 because of the slump in demand.
Like other airlines, China Eastern had said it was expecting a better 2022, though that was before the new lockdowns in China, and any potential knock-on effect of this week’s crash.
Even as pandemic-era restrictions ease elsewhere, China has kept strict curbs on international travel in place, all but wiping out demand for international flights. Domestic air travel has largely continued over the last two years, although demand has remained below pre-pandemic levels as the government has battled sporadic outbreaks of the virus with tough lockdowns.
A China Eastern Airlines plane in Lanzhou, China.
Photo: Qilai Shen/Bloomberg News
Any rebound in passenger numbers could also be hindered by the airline’s decision to ground its fleet of 737-800 aircraft in the wake of the crash.
China Eastern operated a fleet of 734 aircraft in 2020, according to its most recent annual report, including 400 built by Airbus SE and 322 by Boeing Co. At the time, the airline said its wide-body fleet had an average age of 5.6 years, while its narrow-body fleet was 7.4 years old, making its jets among the most modern in the world.
As Chinese aviation expanded, China Eastern became intertwined with the global air transport system. Delta Air Lines Inc. acquired a 3.55% stake in China Eastern in 2015 for $450 million, as the U.S. carrier sought to capitalize on the huge growth in travel between the U.S. and China.
“Delta’s relationship with China Eastern is longstanding,” Delta’s then-chief executive Richard Anderson at the time. “We share a vision that will create the most profitable, enduring franchise between the U.S. and China.” Delta’s stake in China Eastern has since dropped to about 2%, according to a recent filing.
The airlines are both members of the SkyTeam alliance alongside Europe’s Air France-KLM SA, in which China Eastern is the second-largest shareholder after the French state with a 9.58% holding. Adding partners in Europe and the U.S. has enabled China Eastern to expand its global network and offer its customers more choice, the airline has said.
While Monday’s crash is China Eastern’s first in almost two decades, the airline did suffer several accidents in its early years, with four fatal crashes occurring between 1989 and 2004.
In the 2004 crash, 55 people died after a China Eastern Bombardier CRJ200 crashed shortly after takeoff from Baotou in Inner Mongolia.
The induction of increasingly modern aircraft and flight protocols then delivered a long run without any tragedies.
The U.S. government has helped China to improve its aviation safety standards for two decades through the U.S.-China Aviation Cooperation Program overseen by the Federal Aviation Administration.
Even so, foreign pilots working in China have expressed concerns about practices which they say are common to local carriers and increase the risk of accidents. After a string of nonfatal accidents in mid-2018 involving Chinese airlines, the country’s civil aviation authority acknowledged that the “excessive expansion” of Chinese aviation had weakened its safety regime and it pledged to identify and remove unqualified personnel.
Write to Trefor Moss at [email protected]
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