Wuhan cargo airline goes bankrupt after the covid epidemic

Report, photo copyright by : Gan Yung Chyan, KUCINTA SETIA

China's Uni-top Airlines has gone bankrupt. On 21 July 2024, an Airbus A300 aircraft of Uni-top Airlines was put up for auction on the JD platform but no one bid for two days, and it was finally declared unsold.

According to "First Financial Daily", this Airbus A300 aircraft, after two days of auction time, no one bid, and finally declared unsold on 22 July 2024. This is the second time that the aircraft has failed to sell. Previously, Uni-top Airlines had two 747 aircraft auctioned at discounts on the JD platform, and they also failed to sell twice in a row.

Uni-top Airlines is established in 2008. Its main base is at Wuhan Tianhe International Airport. It also has operating bases in Shenzhen, Kunming, Tianjin and other cities. The company is mainly engaged in air cargo business and once owned 13 large and medium-sized all-cargo aircraft.

In March 2024, the Huangpi District Court of Wuhan, Hubei Province issued a civil ruling, declaring Uni-top Airlines bankrupt. This is also the first domestic airline to declare bankruptcy in China after the epidemic, and it is also the first time that a domestic airline has officially gone bankrupt since the bankruptcy and liquidation of Jade Cargo Airlines in 2012.

The report mentioned that before the outbreak of the covid epidemic in 2019, many all-cargo aircraft under Uni-top Airlines had been grounded. After the outbreak of the epidemic, the airline planned to resume work and production in April 2020 but the company's funding problems were not resolved, and financing negotiations and restructuring with multiple parties were not successful, and the start-up funds for resuming flights have not been implemented.

Uni-top Airlines has negotiated financing and restructuring with many parties, including JD.com, China Merchants Group and many domestic and foreign companies and local governments, but in the end, nothing happened. According to data disclosed by the court, the total amount of claims declared by the company's creditors reached 8.321 billion RMB.

Since June 2024, relevant land, real estate and aircraft assets of Uni-top Airlines have been auctioned on the JD platform one after another but no one has bid for the three aircraft in multiple auctions, and they are currently preparing for the third auction.

China's economic downturn has affected various industries. Recently, many listed airlines have successively released their 2024 half-year performance forecasts, showing a state of continuous losses.

Air China expects the net loss attributable to shareholders of listed companies in the first half of 2024 to be about 2.3 billion RMB to 3 billion RMB, China Eastern Airlines' net loss is about 2.4 billion RMB to 2.9 billion RMB, China Southern Airlines' net loss is 1.06 billion RMB to 1.58 billion RMB, and Hainan Airlines' net loss is 600 million RMB to 670 million RMB.