Buying Into China: American Airlines Buys Stake in Country’s Busiest Airline

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American Airlines China Southern Partnership

American Airlines China Southern Partnership

The airline industry is anything but stagnant with new partnerships emerging all of the time. Yesterday we covered Cathay Pacific & Lufthansa’s new codeshare partnership which was the first of its kind for the airlines. Today, American Airlines and China Southern have news of their own.

According to the BBC, American Airlines is buying $200M worth of shares in SkyTeam airline China Southern. (American is in the Oneworld Alliance.) This investment will give them a 2.7% share in the Guangzhou based airline.

It is no secret that China is the fastest growing aviation market and Chinese carriers have been aggressively expanding their fleets and footprints. A partnership like this will help both airlines gain greater access to each other’s aviation markets.

From the BBC:

In a filing to the Hong Kong stock exchange, China Southern said the two sides would work together to share transport, staff and airport facilities – as well as cooperating on code sharing and passenger loyalty programmes.

This is definitely an interesting development considering American currently partners with Cathay Pacific which is headquartered not far from China Southern. Of course China Southern is in the same alliance with Delta as well. From the language this seems like it will be a tight partnership. Only time will tell I suppose.

What do you think? Is this a good move by American or should they worry more about investing their money on the customer experience at home?


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