The nation's flag carrier Air China Ltd said yesterday it plans to reinforce ties with United Airlines this year to reverse losses on Sino-United States routes.
The Chinese mainland's biggest international carrier expects to form a Sino-US air service alliance with United through codeshares and other efforts, which will help secure Air China's leadership in international service over its domestic rivals, the Beijing-based carrier said.
"As United is the biggest carrier on the Sino-US route, we will have a combined market share of more than 70 percent if both carriers ally," said Cai Jianjiang, an Air China vice president. "This will allow us to have better control over the Sino-US air market."
Air China expects to codeshare with United on the upcoming Beijing-Washington, DC, direct service which is scheduled to begin in late March, said Rao Xinyu, an Air China securities unit official, adding that a final decision by United hasn't been made.
"We hope to reverse losses on Sino-US services with strengthened cooperation with United this year," Rao said, declining to elaborate.
"Both carriers have been involved in a strategic partnership since 2004, and Air China has already benefited from improved load factors," she said.
Details coming
United recently won approval from the US Department of Transportation to operate a new nonstop flight from Beijing to Washington, a route that is estimated to be worth US$200 million a year.
The US airline said details on its flight plans will be announced next month.
"We are sure to expand cooperation with Air China through codeshare or co-marketing in the future," said a spokesman for United in Beijing.
Like its domestic counterparts, Air China has been suffering losses on Sino-US routes as a result of appreciation of the yuan and a weaker brand compared with their formidable US rivals.
Air China has just invested 688 million yuan (US$86 million) to upgrade its first-class and business-class facilities on its Sino-US routes and improve its online booking system, Rao said.
China Eastern Airlines which operates a Shanghai-New York and Shanghai-Los Angeles service, said it will seek to expand its advantages on Sino-Japan and Sino-Korean routes to reduce any competitive effects from Air China's latest moves.
(Shanghai Daily January 24, 2007)