News
China Southern to exit SkyTeam?
December 1st 2017
It was speculated in Greater China media this week that China Southern Airlines, Asia’s largest carrier, could relinquish its SkyTeam alliance membership. Read More »
Hong Kong’s South China Morning Post cited Delta Air Lines’ new Greater China chief, Wong Hong, as saying: “I think we have to accept the reality. It is more for them to think through and decide.”
China Southern vice-chairman and president, Tan Wangeng, was recently quoted as saying that the future of the airline’s SkyTeam membership was “a sensitive topic”.
In August, American Airlines closed a US$200 million deal for a 2.68% holding in China Southern, which took many in the industry by surprise.
In an interview with Flightglobal this week, Tan Wangeng said China Southern and American would strengthen their cooperation going forward, particular across the Pacific.
“This is the reason why we set the cooperation strategy relationship with American Airlines. It's just the beginning. In the future, China Southern will fly more to the U.S. and American Airlines will fly more to China,” said Tan.
There is a debate to be had about whether there is enough room for China Southern and Cathay Pacific Airways in the oneworld alliance. Guangzhou and Hong Kong are barely more than 100 kilometres apart although they cater for very different markets. Hong Kong is traditionally a high-yield premium market. Guangzhou is comparatively low-yielding and a premier domestic hub.
In March, Cathay and Europe’s Lufthansa Group signed a strategic partnership on routes to Australia, New Zealand and within Europe.
The tie-up highlights the increasingly competitive nature of the aviation sector today. Lufthansa is battling Gulf carriers on routes to Asia and Cathay has to fend off Gulf carriers as well as aggressively-expanding Mainland carriers that are undercutting fares and yields.
