Air China to expand capacity on domestic and international routes

China’s national flag carrier Air China recently announced it is planning to expand its capacity on both domestic and international routes.

The airline has indicated that it wants to rebalance its domestic and international network amid growing challenges.

Wang Changshun, Chairman of Air China, said that the airline wants to increase its passenger capacity by 8 percent on domestic routes and 12 percent on international routes this year.

Air China flights apparently ran into losses last year. Disclosing its operational results for 2011, the airline reported a 41 percent decline in its net profit to $1.12 billion on rising costs.

The airline attributed the negative outcome to continued recession in the international air passenger market and a significant decline in air cargo operations.

Air China in a statement said that jet fuel costs increased 44 percent last year, and accounted for more than a third of operating expenses of the airline.

Earlier in March this year, the International Air Transport Association cut its forecast for global airline profits in 2012 because of a sharp hike in jet fuel prices. It said that a spike to $150 per barrel could lead to losses as high as $5.3 billion.