China Southern Airlines expects to open 7-8 new international routes this year, expanding on a plan that saw it open 10 new foreign destinations in 2007. Chairman Liu Shaoyang said this year’s routes will originate mostly in Guangzhou and serve neighboring countries in Southeast Asia, in addition to a London flight scheduled to start in the fourth quarter.

It aims to increase the percentage of its revenue derived from international operations from the current 19% to 25%-30% in the next five years while expanding its fleet from 332 aircraft at Dec. 31, 2007, to 400 by 2010.

However, Chairman Liu Shaoyang said, domestic consolidation likely is necessary to maximize international competitiveness. He said Beijing is considering a reorganization of the domestic airline industry but a decision will not be made this year as carriers concentrate on August’s Olympic Games.

Last month he proposed a China Air Holding Co. that would hold stakes in China Southern, Air China and China Eastern Airlines and also would ‘be able to make investments in foreign carriers as well as conduct internal integration.’
Source:

A code share pact means that you effectively double the number of places you fly to without increasing your fleet of aircraft. However, it can be a two edged sword as the two players in the code-share need to be nearly equal in terms of passenger service, on time performance and safety.

China Southern Airlines has announced a new code share pact with Malaysia Airline System(MAS).

In making the announcement, China Southern Airlines’ Chairman Liu Shaoyong said, ‘Starting from 27 November 2007, customers of China Southern Airlines and Malaysia Airlines have been enjoying 35 weekly flights between Kuala Lumpur and Guangzhou, Shanghai and Beijing. These seamless connections between the two parties air network enable China Southern Airlines’ customers flying into Kuala Lumpur to connect to all domestic points served by Malaysia Airlines.

At the same time, Malaysia Airlines’ customers can travel on China Southern flights to more than 90 destinations in China from Guangzhou and 38 from Beijing.

‘This close cooperation has opened new opportunities in the code-share arrangement between China and Malaysia. We firmly believe that such a strategic partnership will offer travelers more choices and seamless destinations served by the two airlines.’

China Southern Airlines operates a fleet of 330 Airbus and Boeing jet aircraft. In 2007, China Southern Airlines transported nearly 57 million passengers, ranked at ninth position worldwide. There are illustrations of hostesses from both airlines to show it is a fair meeting of equals.
Source: Welt Online

Air China’s former chairman Li Jiaxiang has proposed the creation of a super-carrier via his company’s acquisition of smaller rivals. His view is that China should create a state holding company which would control the assets of its top three airlines. His thought being that this would make them better able to compete with global rivals.

Under this plan, recounted to the the 21st Century Business Herald, the holding company would control the assets of China Southern Airlines , China Eastern Airlines and Air China.

The move would forge a closer partnership among the three carriers and enable them to better compete in the global markets.

He added that his firm, Air China, was seeking RMB30 billion to 40 billion ($4.22-5.63 billion) cash injection from the government to boost its capital base.

Aggressive aircraft orders in recent years have pushed debt ratios at major Chinese airlines above 90%, increasing their operating costs.

All three major carriers last year sought cash injections from the government, according to local media reports, but have not yet received a response.

None of which remotely attends to the real problems of the industry.

Passengers judge airlines by promptness and the quality of the inflight service. Promptness requires integration between several authorities but it can be done.

In flight service is something else again. The writer has been on no Chinese airline where the inflight service has been remotely acceptable by international standards.

There seems to be an idea among the cabin crew that they take care of one safety demonstration, one meal (normally served in a slapdash fashion), a clearing away of the debris and then disappear to an undefined space from when they emerge for landing.

No international traveler would take a long haul flight on a Chinese airline by choice. Amalagamating them will not touch the problem.

What is needed is a most stringent test when hiring the staff and a weeding out of the passenger-unfriendly practices which are deeply embedded.
Source: Reuters and agaonizing personal research.

While the back and forth nonsense about Singapore Airlines continues — China Eastern Airlines chairman Li Fenghua said China Eastern wants to hold another shareholder meeting to discuss the planned sale — business continues. In the middle of the other negotiation China Southern Airlines and China Eastern Airlines have agreed on a framework agreement to cooperate in areas such as sales and procurement.

The agreement provides for the airlines to help each other in sales, aircraft procurement, ground service, sharing facilities and other areas.

China Eastern chairman Li Fenghua said it would not affect his firm’s effort to attract investment and find a strategic partner.

Liu Shaoyong, chairman of China Southern, the country’s largest airline by fleet size, said talks on the agreement had begun more than a year ago, and that the pact did not exclude cooperation with other carriers such as flag carrier Air China.

Meanwhile China Eastern has insisted it will not accept the Air China group as a strategic investor, and China Eastern’s parent group has refused to consider the proposal, saying it is incomplete and lacks legal validity. Eventually it will all be sorted out.
Source: CargoNews Asia

China Southern Airlines said that 2007 had been a record year as it reported a near 10-fold jump in profits.

The past two years represented a strong turnaround for the airline, which ended a four-year string of losses in 2006.

General manager of CSA, Liu Shaoyong, said the nation’s biggest carrier by fleet size saw profits rise to a record RMB3 billion (US$411 million) from RMB306 million in 2006. The airline made progress in expanding its hub operations and marketing networks.

Liu Shaoyong said, ‘It is the best financial result China Southern has ever had.’

Revenue from transportation business rose 13.6% year-on-year to a record 50 billion yuan in 2007.

The Guangzhou-based company carried 56.74 million passengers in2007, up 15.3% from a year earlier. The figure represented a 30.2% share in China’s civil aviation industry.

Cargo transport volume rose 5.4 percent to 863,000 tonnes, for a 21.8% share in the industry.

Liu also ascribed the strong performance to shareholder reforms that allowed non-tradable, state-owned shares to float on the market, which boosted investors’ optimism.

The carrier ordered 10 Airbus A330-200s last October and 55 Boeing 737s in August, as part of its efforts to meet market demand and refurbish its fleet.

In the fourth quarter of 2009, it is scheduled to take delivery of five A380s, Airbus’ jumbo double-decker plane, which can seat up to 850 passengers.
Source: People’s Daily Online