Morgan Stanley reported a year-over-year contraction in air passenger traffic in China during the Labor Day holiday window from May 1-5, with air travel down 5.7% compared with the same period a year earlier, based on Ministry of Transportation figures.
Despite the drop in air travel, aggregate passenger traffic across transport modes increased 3.5% year-over-year over the holiday. Railway ridership rose 4.6% year-over-year and road passenger movements increased 3.5% year-over-year, indicating that the decline in air volumes was not mirrored across all transport channels.
Morgan Stanley attributed the reduction in air passengers to demand dilution stemming from Spring holidays - including additional leave granted in some provinces ahead of Golden Week - and to higher airfares. Industry DAST data cited by the firm showed that air ticket prices were up 9.7% year-over-year, and total flight frequency declined 2.6% year-over-year during the same holiday window.
The National Immigration Administration reported growth in cross-border travel during the holiday period, with cross-border movements up 3.5% year-over-year and foreign visitor numbers rising 12.5% year-over-year.
On the parcel and logistics front, daily express pick-up volume was down roughly 5% year-over-year during the holiday. Morgan Stanley estimated that express parcel volumes declined year-over-year over the Labor Day holiday, a pullback from the 2% year-over-year growth observed in April.
The report noted factors behind the parcel slowdown, including the exit of low-value parcels following an industry price increase and the effect of holiday travel demand on e-commerce activity, both of which contributed to reduced parcel throughput during the holiday period.
Context and data sources cited in the analysis
- Ministry of Transportation data for passenger traffic comparisons.
- DAST industry data on air ticket pricing and flight frequency.
- National Immigration Administration figures for cross-border travel and foreign visitor counts.
- Morgan Stanley estimates and interpretation of parcel volume trends and travel demand effects.
The observations highlight a divergence between air travel and other transport modes during the holiday stretch, with pricing dynamics and calendar effects identified as key drivers behind the air travel decline, and parcel industry pricing and shifting consumer mobility patterns cited as contributors to logistics softness.