Goldman Sachs: Downgraded Air China (00753) and China Southern Airlines (01055) to “sell” preferences Spring Airlines (601021.SH)

The Zhitong Finance App learned that Goldman Sachs released a research report saying that its views on China's aviation industry are becoming more conservative, mainly affected by rising aviation fuel price predictions and rising maintenance costs due to the aging of the fleet. The bank downgraded Air China (00753) and China Southern Airlines (01055) A/H share ratings to “sell,” and China Eastern Airlines (00670) A/H shares to “neutral.” The bank favors Spring Airlines (601021.SH) and maintains its “buy” rating.

Goldman Sachs pointed out that the 2026 aviation fuel price forecast was raised to 144 US dollars per barrel, and the 2027 and 2028 forecasts were 120 US dollars and 100 US dollars per barrel, respectively. As airlines bear most of the increase in fuel costs in order to maintain passenger traffic growth, the bank is becoming more cautious about the outlook for the industry. The bank believes that with strong cost control capabilities, a younger fleet, and low sensitivity of profits to fuel prices, Spring Airlines is best able to cope with these industry headwinds.