China Southern Airlines confirmed on Tuesday that it was in
talks with Air France to explore the possibility of establishing a
joint-venture cargo airline.
A statement released by the company stressed that discussions
were at an early stage and as yet, no solid agreement had been
reached.
Analysts believe that China Southern prefers European and
American airline companies as its partners due to its hopes of
promoting sales of cabin space for cargo planes on their way back
to China from abroad.
Xu Jiebo, vice general manager of China Southern, told the
Shanghai Securities News last year that his company was
seeking cooperation with Air France-KLM and other Sky Team member
airlines.
A foreign company is allowed to possess a 25 percent stake, at
most, in a Chinese airline and China Southern "Surely hopes the
foreign investor will hold the biggest possible share if the
negotiation turns out to be successful," the newspaper cited Xu
assaying.
As one of the three largest Chinese airline companies, China
Southern is the only one that does not have a cargo transport
unit-- China Eastern and COSCO Group established China Cargo
Airlines in 1998, while Air China set up Air China Cargo in
2003.
In 2004, Shenzhen Airlines established Jade Cargo International
with Lufthansa Cargo and DEG.
The joint-venture has proved to be fierce competition for China
Southern in south China's market for air cargo transport.
(Xinhua News Agency May 16, 2007)