(Yicai) Sept. 4 -- Airfares in China have dropped sharply following the end of the summer travel rush, with some new international routes priced as low as CNY200 (USD28), putting pressure on airline profits.

Alongside the seasonal decline, Thai Lion Air and South Korean budget carrier Aero K Airlines have launched ultra-low-cost flights from Datong in central China to Asian destinations, supported by government subsidies. Industry insiders told Yicai the move is part of a strategy to attract more passengers.

Passengers reported that the carriers are offering tickets priced between CNY200 and CNY300 for October flights from Datong, Shanxi province, to Bangkok and Seoul. In comparison, flights on the same routes from Shanghai cost more than CNY500.

Thai Lion Air launched its direct Datong-Bangkok route late last year, marking the first international service from Datong Yungang International Airport, which serves the city known for the Yungang Grottoes. Aero K began its direct Datong-Seoul route last month.

Domestic airfares have also decreased since the summer peak. Ticket prices on the 20 busiest domestic routes fell last week both week-on-week and year-on-year, according to data from flight information provider Flight Master.

For instance, the average fare between Shanghai Hongqiao International Airport and Shenzhen Bao’an International Airport -- China’s busiest air route -- was CNY785 last week, down 9 percent from the previous week and 8 percent from the same period last year, per Flight Master.

Some civil aviation firms have increased capacity at excessively low prices to compete for market share, leading to inefficient and homogeneous competition, Song Zhiyong, director of the Civil Aviation Administration of China, said at a working conference in June. He noted that while the industry has seen rising scale and revenue, profits have continued to fall.

China’s three state-owned airlines remained unprofitable during the first half, according to their latest financial results. Air China posted a net loss of CNY1.8 billion (USD252 million), a 35 percent narrowing from a year ago. China Eastern Airlines reported a CNY1.4 billion loss, improving by 48 percent, while China Southern Airlines logged a CNY1.5 billion loss, up 25 percent.

Editors: Dou Shicong, Emmi Laine