The US Department of Transport (DoT) has approved codesharing between Delta Air Lines and China Southern Airlines covering transpacific and US domestic services.
China Southern can add its code to Delta flights from Los Angeles to Atlanta, Boston, Chicago, Dallas/Ft Worth, Detroit, Honolulu, Las Vegas, Miami, Minneapolis/St Paul, New York, Philadelphia, Portland, San Francisco, Seattle and Washington DC. Delta plans to put its code on China Southern's Guangzhou-Los Angeles services.
"We think that the Chinese market is very promising and the regional economy [in Guangdong province] is stronger than in other parts of the country," says Delta.
According to Chinese industry sources, the country's Civil Aviation Administration approved three Chinese airlines establishing codeshare tie-ups with foreign carriers. China Southern is the last of these to form a partnership. Air China has established ties with Northwest Airlines, and China Eastern Airlines has linked up with American Airlines.
Loss-making China Southern, based in Guangzhou, is pushing to cut costs and streamline its management structure in an attempt to achieve profit.
Official press reports say the airline aims to achieve 1999 turnover of 10.3 billion yuan ($1.24 billion). It has not released full-year 1998 results, but made a first-half loss of 72.3 million yuan. Turnover for 1997 was 12.8 billion yuan.
"In general, China Southern is not better or worse off than any other airline in China," says one industry observer. "The airlines have never been accountable [for their financial results], and are facing reality in a slump of the economic cycle."
China Southern plans to continue restructuring its route network this year, dropping unprofitable flights in favour of new, more promising, ones such as the proposed Shanghai-Amsterdam route planned for June.
The company wants to boost its market share by 3% this year, and will increase its marketing efforts on international flights.
Source: Flight International
