Minsheng Securities: In September, the high passenger load factor of airlines has led to an increase in prices; pay attention to the price turning point in the off-season

According to the Zhitong Finance APP, Minsheng Securities released a research report stating that the domestic air ticket price data in September rebounded year-on-year, driven firmly by the improvement in supply and demand. The tight supply logic remains unchanged, and the continuous narrowing of the supply-demand gap is expected to reach a turning point in Q4 2025. The high utilization and passenger load factor have led to a year-on-year rebound in domestic route ticket prices. After the conclusion of significant foreign affairs activities at the beginning of September, business travel demand improved, stabilizing and increasing domestic route prices. The continuous improvement in business travel demand is expected to drive price increases in the industry year-on-year in the fourth quarter, enhancing investment sentiment in the sector.

Minsheng Securities' main viewpoints are as follows:

Industry Dynamics: A-share listed airlines released operational data for September 2025

In September, air travel demand benefited from an increase in passenger flow and a longer flight distance, with growth rates exceeding supply. Both domestic and international route passenger load factors reached new highs. The supply-demand continued to grow year-on-year in September, with endogenous growth in domestic passenger flow and further lengthening of flight distances driving demand growth. The year-on-year growth of supply was limited due to a high base. According to announcements from various companies, the six A-share listed airlines in September had a combined ASK/RPK year-on-year growth of +4.0%/+7.1%, with domestic and international route passenger load factors both reaching record highs for September:

1. In September, the gap in domestic supply-demand growth widened, and the passenger load factor reached a high level: The six airlines had a domestic ASK/RPK year-on-year growth of +2.2%/+4.7%, with a passenger load factor of 87.3%, up +2.1 percentage points, reaching the highest level for September in history; 2) In September, the growth rate of international route supply slowed, widening the gap with demand growth: The six airlines had an international ASK/RPK year-on-year growth of +8.7%/+13.6%, with a passenger load factor up +3.5 percentage points. The turnover of international routes continued to grow significantly compared to the high base in the same period of 2024, but the growth rate of supply has slowed. In September, ASK/RPK reached 98.0%/102.9% of the same period in 2019, indicating that the current supply in the industry has entered a relatively tight bottleneck period.

In September, the industry's aircraft utilization rate operated at a high level, with high passenger load factors translating into price increases, and the supply-demand relationship remained tense with some recovery in business travel demand

Minsheng Securities stated that, considering both volume and price, the industry data in September performed excellently, with utilization rates remaining high and passenger load factors translating into price increases.

1. Utilization Rate: According to Flight Butler, the industry's aircraft utilization rate in September was 7.8 hours, basically flat year-on-year, with wide-body aircraft down -3.4% year-on-year and narrow-body aircraft up +0.4% year-on-year; 2) Passenger Load Factor: The six airlines had a domestic route passenger load factor of 87.3% in September, up +2.1 percentage points year-on-year and +3.9 percentage points compared to the same period in 2019, reaching a historical high; 3) Price: Flight Butler indicated that in September, the domestic economy class ticket prices including fuel surcharges and excluding fuel surcharges increased by +0.6% and +1.0% year-on-year, respectively. According to Trip.com, domestic ticket prices in September increased by +2.4% year-on-year, while international ticket prices decreased by -15.2% (with Trip.com reporting a year-on-year decline of 4.3% and 14% for domestic and international tickets in August, respectively). The high utilization and passenger load factors have continuously contributed to the rebound in domestic prices.

In September, the fleet of the six airlines grew by 0.3% month-on-month, with narrow-body aircraft remaining the main type introduced, and the industry fleet size steadily expanded

According to company announcements, as of September 2025, the six A-share listed companies managed a total of 3,340 aircraft, with a net increase of 11 aircraft month-on-month, representing a cumulative increase of +3.6% compared to the end of 2024. The fleet size of the six airlines continued to expand in September Among them, the main aircraft models are the A320 series and B737 series: six airlines have introduced a total of 19 narrow-body aircraft (1 C919, 6 B737, 12 A320).

Target Aspect

Focus on China Eastern Airlines (600115.SH), China Express (002928.SZ), Air China (601111.SH), China Southern Airlines (600029.SH), Juneyao Airlines (603885.SH), and Spring Airlines (601021.SH).

Risk Warning

Business travel demand recovery is less than expected; significant rise in oil prices; fluctuations in the RMB exchange rate; aircraft failures causing widespread grounding