Air China Chairman Not Certain Of Profit In 09

Air China Chairman Kong Dong said on Monday it was uncertain whether the country's flag carrier could turn a profit in 2009 and the time was not right for large airline acquisitions in China.

"I can't be certain of profit this year," Kong said.

The aviation industry was going through its worst winter and there was no sign of improvement in the global economic situation, he told reporters in a briefing.

"I can't be optimistic about this year," he said. However, Kong said he had confidence the government's policies -- including the CNY4 trillion (USD$585 billion) stimulus package -- would help the economy reach the targeted 8 percent growth this year.

Kong also said Air China would seek compensation from US aircraft manufacturer Boeing for delays of its new 787 Dreamliner, which was about two years behind schedule.

China Eastern Airlines, China Southern Airlines and Air China, the country's three biggest carriers, have all warned of losses for 2008 due to slowing air traffic amid the global recession.

The airlines are seeking government aid, sources have said, but China Eastern's chairman said that a major restructuring of the industry was unlikely any time soon.

China National Aviation, state-owned parent of Air China, hopes to receive government aid but the group can survive without any aid, said Kong, who is also the president of the parent firm.

"I am hoping for government support," he said. "But if the government can't provide that support, Air China will be able to get by."

Kong said Air China had the healthiest balance sheet and the best brand name in the mainland, putting it in the strongest position to survive the global recession.

China National Aviation will soon acquire East Star Airlines, a small private carrier with just nine planes based in the central city of Wuhan, he added.

Shares of Air China closed down 6.2 percent at HKD$1.98 in Hong Kong on Monday, underperforming a 4.6 percent drop in the index for major Chinese companies listed in Hong Kong.

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