Key insights
- China's air passenger traffic declined 5.7% YoY during the Labor Day holiday, attributed to demand dilution and higher ticket prices. Express parcel volume also decreased, signaling a potential slowdown in e-commerce. While cross-border travel increased, the overall data suggests a mixed economic picture in China, potentially impacting global companies with significant exposure to the Chinese market. This could translate to slightly negative sentiment for US equities with substantial China revenue.
Investing.com -- Morgan Stanley reported that air passenger traffic in China fell 5.7% year-over-year during the Labor Day holiday period from May 1-5, according to data from the Ministry of Transportation.
The decline came as total passenger traffic grew 3.5% year-over-year during the holiday period. Railway passenger traffic increased 4.6% year-over-year, while road passenger traffic rose 3.5% year-over-year.
Morgan Stanley attributed the air travel decline to demand dilution from Spring holidays, which included extra holidays granted before the Golden Week in some provinces, as well as higher ticket prices driven by increased fuel costs. According to DAST data, air ticket prices were up 9.7% year-over-year.
Total flight frequency decreased 2.6% year-over-year during the Labor Holiday, DAST reported.
Cross-border travel grew 3.5% year-over-year, with foreign visitors increasing 12.5% year-over-year, according to the National Immigration Administration.
Daily express pick-up volume fell approximately 5% year-over-year during the holiday period. Morgan Stanley estimated express parcel volume declined year-over-year during the Labor Day holiday, representing a further slowdown from 2% year-over-year growth recorded in April.
The firm noted that the parcel decline was influenced by the exit of low-value parcels following an industry price hike, as well as holiday travel demand affecting e-commerce activity.