China Southern Airlines has the Galaxy in its sights
25 / 07 / 2011
SINOTRANS and Korean Air could ditch troubled Galaxy International Cargo Airlines, leaving China Southern Airlines free to claim a majority stake.
Galaxy International Cargo Airlines, which was co-founded with two other South Korean companies in December 2007, has faced consistent financial woe over the last three years. The cargo player suffered losses of 182 million yuan (US$28.2 million) in 2008, 94.32 million yuan ($14.6 million) in 2009 and 28.89 million yuan ($4.5 million) in 2010.
Sinotrans and Korean Air are currently considering development plans for Galaxy International.
Southern previously planned to establish a cargo unit with Air France-KLM named AE Cargo, but Air France walked away from the deal after the global financial crisis.
Southern is the only airline in China’s top three, which does not have its own cargo transportation subsidiary. Air China and Cathay Pacific created a joint venture called Air China Cargo, while China Eastern Airlines cooperated with Cosco, EVA Airways and Singapore Airlines Cargo to establish China Cargo Airlines.