(Yicai Global) June 21 -- The Chinese government should maintain the policy support introduced during the pandemic until the end of next year, as carriers are still losing money, an industry group that represents China’s airlines has suggested.

China should give financial and fiscal policy support to the industry, actively extend special emergency loans for civil aviation, and issue CNY200 billion (USD27.8 billion) of bonds, the China Air Transport Association said, as the nation’s air transport firms still face immense pressure.

“Civil aviation is one of the sectors most severely affected by the three-year pandemic, which caused serious losses across the industry that continued in the second quarter,” the CATA added. “The sector has not yet achieved profitability, remaining in a very difficult period.”

Moreover, experts suggest allowing airlines to extend the maximum carryover period for losses incurred in 2021 and 2022 to 10 years from five years, enhance policy support for the operation of domestic aircraft, and cut taxes and fees related to their flight operations.

The industry’s ongoing losses are mainly due to the lag in the international market’s recovery, the real alternative offered by high-speed rail services in China, and the end of the high-profit cycle of air cargo transport, according to experts.

China lifted its Covid-19 restrictions at the start of the year. Since then, domestic flights have increased steadily, but as the industry has still amassed losses of CNY300 billion (USD41.7 billion), some major airline investors are seeking to offload their stakes, Yicai Global learned.

Some airlines remain upbeat about 2013. At the start of the year, the chairmen of Spring Airlines and Juneyao Airlines both expressed confidence in swinging back to profit this year. Many industry insiders are also optimistic about the second half, as they believe the summer travel season will help airlines boost their performance.

The number of average daily flights in China over summer is expected to climb 11 percent to 13,600 from the same period of 2019, according to a the Civil Aviation Administration of China. Passenger numbers may rise 7 percent to over 1.8 million.

Online searches for summer holiday flights jumped 25 percent compared with the pre-pandemic level in 2019, according to data from online travel agency Trip.Com.

Editor: Futura Costaglione