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China Eastern backs SkyTeam partnership

China 18.04.2010 Comments Off

Joining the SkyTeam will help China Eastern Airlines fend off the competition from major rivals and share more resources with other members. (Agencies)

By Wang Ying (China Daily) – SHANGHAI – China Eastern Airlines said on Friday it would sign a memorandum of understanding to join global airline alliance SkyTeam.

“What we have signed is a preliminary agreement. And after a year when China Eastern fulfils all the requirements of SkyTeam, we will become its official member,” Luo Zhuping, company board secretary, told China Daily.

The Shanghai-listed airline had been the only one of China’s top three carriers not to be a member of any global alliance.

Analysts said joining the alliance will help the airlines fend off the competition from major rivals and share more resources with other members.

Liu Shaoyong, chairman of China Eastern, said earlier this week the company was in talks with all three global alliances, including Star Alliance and Oneworld. Sources with knowledge of the matter told China Daily that all three alliances were lobbying the carrier with favorable conditions.

Currently, both Shanghai Airlines and Air China belong to Star Alliance, and the two carriers share a lot of resources in term of customers, flight transition and air ticket booking on the platform. Guangzhou-based China Southern Airlines is member of SkyTeam.

“The airlines’ choice is easy to understand,” said Yao Jun, an aviation analyst at China Merchants Securities. “As former chairman of China Southern Airlines, Liu would like to join forces with China Southern to compete against the nation’s most profitable airlines, flag carrier Air China Ltd,” Yao said.

This also marks a major victory for SkyTeam which has sought to expand its membership in the Asia-Pacific region, one of the world’s fastest growing aviation markets. – read more at ChinaDaily.com…

Tags: Airlines, China, China Eastern, Shanghai, SkyTeam
China state fund for homegrown jumbo jet urged

China 29.03.2010 Comments Off

By Xin Dingding (China Daily) – Beijing – The chief designer of the country’s first C919 jumbo jet has urged authorities to establish a multi-billion-yuan State fund to help boost the sales of homegrown airplanes.

More financial support from the government will bolster the domestic aviation industry, which is facing strong competition from foreign players such as Boeing and Airbus, said Wu Guanghui, vice-president of the Commercial Aircraft Corporation of China Ltd (COMAC).

China is forecast to need about 4,000 planes in the next 20 years.

State fund for homegrown jumbo jet urged

Major domestic airlines such as Air China, China Eastern and China Southern, as well as Sichuan Airlines and Hainan Airlines, have expressed strong interest and support in buying his company’s jumbo jet, Wu said.

The letter “C” in the title of the country’s first homegrown jumbo jet is said to stand for “China” as well as “COMAC”, while the first “9″ implies “forever” in Chinese culture and the “19″ stands for the jet’s maximum 190 seats.

The single-aisle jetliner is designed for short- to medium-haul flights of up to 5,555 km.

The draft design of the country’s first independently developed jumbo jet will be completed by this year and be put into production by next year, Wu had said earlier.

The plane is slated to test fly in 2014 and be ready for deliveries after 2016. COMAC, which was founded in 2008 to take charge of the country’s jumbo jet project, expects to sell 2,000 C919 planes at home and abroad in the next two decades, Wu said.

State fund for homegrown jumbo jet urged

“But what could harm the sales of the domestically made planes is that very few aircraft-leasing companies buy domestic airplanes and rent them to airlines,” he said in an interview with China Daily.

“Leasing is the major way for airlines to expand the fleet … and the situation will especially hinder small airlines, which are short of funds, from buying the cheaper homemade jets.”

Wu suggested that the government establish a State fund of at least 30 billion yuan to help homegrown jet buyers with their financing. – read more at ChinaDaily.com…

Tags: Air China, Airbus, Airlines, Boeing, C919, China, China Eastern, China Southern, COMAC
Shanghai’s new airport terminal starts operation

China 16.03.2010 Comments Off

Shanghai's Hongqiao Airport

A new airport terminal in Shanghai started operation Tuesday ahead of the opening of the Shanghai World Expo amid the city’s efforts to build a “world-class” traffic hub.

The 360,000 square meter terminal with a new runway has 45 plane parking bays and an annual transport capacity of 40 million people, said Shen Xiaosu, deputy director of Shanghai’s Urban, Rural Development and Traffic Committee.

As of March 16, a total of 11 domestic carriers including Shanghai-based China Eastern Airlines, Air China and China Southern Airlines had moved their operations to the new terminal. The old terminal will be primarily used by some budget airlines and chartered flights to Japan and the Republic of Korea, according to the airport’s website.

Together with the opening of the new terminal on Tuesday, the extension of Shanghai’s subway line 2 linking with the new terminal also started operation, the airport’s website said. – read more at People’s Daily Online…

Tags: Air China, Airlines, China, China Eastern, China Southern, Hongqiao, Shanghai
China Eastern airlines approved to raise 7 billion yuan

China 05.11.2009 Comments Off

China Eastern Airbus A340

By Qiang Xiaoji (chinadaily.com.cn) – China Eastern Airlines, China’s third largest carrier by fleet size, said Wednesday it has won regulators’ approval to raise about 7 billion yuan ($1.03 billion) through a private placement, in a bid to turn its net assets to the black before completing a proposed merger with Shanghai Airlines.

China Securities Regulatory Commission (CSRC) on Wednesday afternoon approved the air carrier’s new issuance of 1.35 billion A shares and 490 million H shares with a combined worth of 7.02 billion yuan through a private placement, the company said.

The latest announcement means the carrier has completed all the required legal procedures for the new issuance to go ahead after the plan was approved by its shareholders in September.

China Eastern intends to sell the Shanghai-listed A shares to as many as ten selected investors, including its parent China Eastern Air Holding Co, the China Business News (CBN) reported today, citing Luo Zhuping, board secretary of the company.

China Eastern’s asset structure will be better-off upon completion of the new issuance. Earlier, its chairman Liu Shaoyong had estimated that raising 7 billion yuan would help cut the company’s debt-to-asset ratio significantly to about 94.7 percent.

China Eastern returned to net profit in the third quarter of 2009, thanks to rising demand for air travel and declining fuel prices. It made a net profit of 23.16 million yuan in the quarter. In the first nine months of this year, the company made a net profit of 1.2 billion yuan, compared with a net loss of 2.29 billion yuan in the same period of last year. But its net assets remain in the negative territory. read more at ChinaDaily.com…

Tags: Airlines, China, China Eastern