Source: ATW Daily News Author: Katie Cantle 07/15/2008
Subject Concerned: Airlines
Air Macau has become another victim of surging oil prices and is clinging to survival as it awaits help from parent Air China Group.
According to China Business News, the Macau carrier posted a net loss in excess of MOP200 million (US$24.6 million) in the first six months of this year, more than half of its registered capital of MOP400 million. Under Macau law, exceeding that threshold requires the company to either inject new capital or declare bankruptcy.
Air China Board Secretary Huang Bin acknowledged Air Macau's request for help and said CA will determine a solution with other NX stakeholders, including TAP Portugal's SEAP investment fund (15%), casino company Sociedade de Turismo e Diversoes de Macau (14%), the Macau SAR Government and EVA Air. CA holds a 51% stake.
In a company statement cited Jul. 14 by the Macau Daily News, Air Macau said it has reached a strategic cooperation agreement with CA and that aid will be extended soon.
Industry analysts are suggesting that the recently inaugurated flights across the Taiwan Strait will join oil prices in impacting NX's performance, especially when, as expected, regularly scheduled service begins. Currently, 60% of its operating revenue is generated by transfers between the Chinese mainland and Taiwan.
But Air Macau noted in the statement that CA will support its effort to secure "special routes" from CAAC after the regular cross-strait flights begin.