Members of the new China Sky Aviation Enterprises Group are the Shandong Airlines, Shanghai Airlines, Shenzhen Airlines, Sichuan Airlines, Wuhan Airlines and the China Post Airlines.

According to sources at Shanghai Airlines, member airlines will seek to expand co-operation but will remain independent corporate bodies.

They want to operate joint air routes, link their routes to facilitate transfers, jointly develop an e-commerce platform, cross-agent and co-operation in ground services, and share airplanes and other resources.

Soon, the members will begin code-sharing on major routes and develop cargo post services, the sources said.

The group now owns nearly 100 planes and operates over 500 routes. It handled more than eight million passengers and earned a profit of eight billion yuan in 2000, accounting for 12 percent and 35 percent of the national total, respectively.

Local airlines came into prominence in the mid-1980s, with 35 airlines operating at one point. But their numbers have been dwindling due to continuous restructuring of the industry.

The latest round of mergers and acquisitions in the industry has further reduced the number of local airlines to less than 10. Besides the Sky Aviation, Hainan Airlines and Xinhua Airlines have also entered an alliance.

Zhou Chi, president of Sky Aviation and general manager of Shanghai Airlines, claimed that local airlines still have room for development even under the new market system, and that the group will seek to expand the alliance to include other local airlines.

(China Daily 05/09/2001)