China’s big three told to merge cargo

CHINA’S government has decreed that the country’s three main airlines – Air China, China Eastern and China Southern – have to merge their cargo operations.

The authoritarian move is an attempt to challenge foreign carrier’s dominance of the market. About 70 per cent of the international air cargo in China is carried by foreign airlines.

A task force made up of airline officials and state officials from the Assets Supervision and Administration Commission (Sasac) has been formed to work on the structure of the proposed joint venture.

An unnamed source told the Chinese media that the cargo airline would be based in Shanghai.

If the plan goes ahead (and with the Chinese government’s hand at the tiller why wouldn’t it?) the joint venture between Cathay Pacific and Air China, aiming to service China’s Yangtze River Delta region, is put at risk.

However, a Cathay spokesperson said: “Our target of having the joint venture carrier coming into operation this summer remains unchanged.”