Navigating a new growth course
Updated: 2013-04-18 10:30
By He Wei (China Daily)
Ma Xulun, general manager of China Eastern Airlines Co Ltd [Provided to China Daily]
That, however, was not the case five years ago when Ma joined China Eastern. It was the worst possible time for someone to take the helm of a sinking ship. The carrier was reeling from a financial crisis after its debt-to-asset ratio hit a historic high of 115 percent.
"There was severe turbulence and churn in the aviation industry during those days. There were three major hurdles in the form of high oil prices, negative growth in cargo business, and the stagnant global economy, especially in Europe," he said.
Ma said that the first priority for China Eastern was to reduce its huge debts. "We took several steps like market borrowings, capital injection from government and enhancing profits," he said.
In 2009, the carrier also undertook a painful restructuring by merging with the then cross-town competitor Shanghai Airlines, in a bid to optimize assets and trim debt.
Despite all the efforts, Ma still found it hard to find other sources of income. It was then that he started the campaign to expand China Eastern's overseas routes.
That seems to have more than paid off as more than 47 percent of the airline's revenue now comes from international business, though as Ma admits a still higher percentage is required to gain a global reputation.
"Our vision is to build China Eastern into a world-class airline. We want to realize this goal by fully leveraging on Shanghai's geographic advantage as a transportation hub," he said.
Ma has already sensed an opportunity. From this year, Shanghai has allowed transit passengers from 45 countries to stay in the city for 72 hours without a visa.