Guosheng Securities: Airline passenger volume growth, ticket price recovery, focus on business travel demand and the recovery of international flights

According to the Zhitong Finance APP, Guosheng Securities released a research report stating that as of October 14, 2025, the number of civil aviation flights executed in 2025 will be 15,539 flights per day, compared to 14,980 flights per day in the same period of 2024, an increase of 3.73% year-on-year, with a steady increase in flight volume. From the perspective of passenger load factor, the civil aviation passenger load factors from July to September 2025 are 84.5%, 87.5%, and 85.8%, all higher than the levels in the same period of 2019. Currently, with low growth in airline supply and continuous recovery in demand, the supply-demand gap is narrowing, coupled with a downward shift in oil price levels and the promotion of "anti-involution" policies, we await the continuous recovery of ticket prices and the ongoing improvement of airline profitability. Continuous tracking of demand recovery is necessary, with a focus on business travel demand and the recovery of international flights.

Guosheng Securities' main viewpoints are as follows:

Holiday personnel flow reaches a historical high, strong willingness to travel

The consecutive holidays of National Day and Mid-Autumn Festival, along with convenient "leave-sharing" methods, have fostered a strong willingness for private travel during the holidays, creating conditions for long-distance and in-depth travel. According to data from the Ministry of Transport, from October 1 to 8, 2025 (National Day and Mid-Autumn Festival holiday), the total inter-regional personnel flow is expected to reach 2.432 billion person-times, setting a historical high for the same period, with an expected daily year-on-year increase of 6.2%. Among them, the actual civil aviation passenger volume is 19.138 million person-times, averaging 2.392 million person-times per day, with year-on-year increases of 4.1% and 26.9% compared to 2024 and 2019, respectively. The record high data for holiday personnel flow and the year-on-year increase in civil aviation passenger volume demonstrate the resilience of civil aviation demand.

Flight volume steadily increases, passenger load factor rises steadily, ticket prices continue to recover

As of October 14, 2025, the number of civil aviation flights executed in 2025 will be 15,539 flights per day, compared to 14,980 flights per day in the same period of 2024, an increase of 3.73% year-on-year, with a steady increase in flight volume. From the perspective of passenger load factor, the civil aviation passenger load factors from July to September 2025 are 84.5%, 87.5%, and 85.8%, all higher than the levels in the same period of 2019; in September 2025, the average passenger load factor of the three major airlines is 85.7%, an increase of 5 percentage points compared to the same period in 2019, better than the industry average increase. In September 2025, the average inclusive tax ticket price for domestic economy class in civil aviation is 697 yuan, a year-on-year increase of 0.6%, compared to a year-on-year decrease of 5.0% in September 2019; during the National Day and Mid-Autumn Festival holiday in 2025, the average ticket price for domestic economy class in civil aviation is 849 yuan, a year-on-year increase of 0.3%, compared to a year-on-year decrease of 1.4% in the 2019 holiday, indicating a continuous recovery in ticket prices.

International flight volume shows remarkable growth, domestic flight volume steadily progresses

Breaking down the flight volume structure, the execution volume of international flights and flights to Hong Kong, Macau, and Taiwan has significantly increased. As of October 14, 2025, the daily average of civil aviation international flights and flights to Hong Kong, Macau, and Taiwan in 2025 reaches 2,154 flights per day, an increase of 16.70% year-on-year; the daily average of domestic flights executed in 2025 is 13,885 flights per day, an increase of 1.91% year-on-year. With the continuous expansion of visa-free travel areas, the demand for international travel and exchanges is being continuously activated. As of the end of June 2025, the volume of international flights has recovered to 88% of the level in the same period of 2019 Capacity expansion is limited, and supply is expected to grow at a low rate

Due to the impact of special health events and international political conflicts, the manufacturing supply chains of major global aircraft manufacturers have been severely affected, significantly slowing down the global aircraft delivery pace. Boeing and Airbus are expected to deliver 348 and 766 aircraft respectively in 2024, with year-on-year growth rates of -34.1% and 4.2%. It is anticipated that aircraft deliveries will continue to face pressure in the future. Considering the delivery cycle of the domestically produced C919 passenger aircraft, the aging of the existing fleet which will gradually retire, and the increasingly stringent industry regulatory entry restrictions, it is expected that the expansion of air transport capacity will continue to be limited, and supply will maintain a low growth rate.

Oil prices are trending downward, and the effects of comprehensive rectification of "involution" competition are awaiting implementation

Since 2025, international oil prices have been on a downward trend, and the reduction in jet fuel costs is beneficial for the profit release of airlines. On June 26, 2025, the civil aviation sector's "anti-involution" rectification work began. The "involution" competition in the civil aviation sector is mainly reflected in the continuous decline of ticket prices to a state of "involution." With the continuous advancement of "anti-involution" policies and the ongoing implementation of comprehensive rectification effects, a recovery in ticket prices in the civil aviation sector is expected.

Investment recommendations

With low supply growth and continuous recovery in demand, the narrowing supply-demand gap, combined with the downward trend in oil prices and the promotion of "anti-involution" policies, we await the continuous recovery of ticket prices and the ongoing improvement of airline profitability. It is advisable to continuously track the recovery of demand and pay attention to business travel demand and the recovery of international flights. It is recommended to position on the left side of the aviation sector, focusing on Huaxia Airlines (002928.SZ), Air China (601111.SH, 00753), China Eastern Airlines (600115.SH, 00670), China Southern Airlines (600029.SH, 01055), Juneyao Airlines (603885.SH), and Spring Airlines (601021.SH).

Risk warnings

Recovery of travel demand may fall short of expectations; risks related to the credibility of third-party data; risks of changes in domestic and international policies; risks of significant depreciation of the RMB; risks of significant increases in oil prices, etc