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China Southern Airlines Company Limited is the largest airline as far as the fleet is concerned in China. The organization consolidated a great position at a global level as well. It is the fourth largest carrier that transported the most passengers in the world. Along with Air China and China Eastern Airlines, it is known as the Big Three airlines in the country. As of recently, the company admitted a negotiation line with the American Airlines. This new collaboration might spark up the industry and improve global airline routes.
Shares of China Southern Airlines Rose to Highest Point in Three Months
China Southern Airlines Co. saw its shares rise to their highest value in the last three months. This boost was generated by the latest news. Asia’s biggest carrier admitted that it opened up the discussion of a possible tie-up with the American Airlines Group Inc. The collaboration might allow the American airline to buy a stake of China Southern.
On Sunday, during an exchange filing, the Chinese company confessed the possibility of a market strategy with the American Airlines over a stake purchase, but also other business ideas. On Monday, the stakes proliferated 5.3% to HK$5.74 in Hong Kong. The first similar collaboration occurred as recently as 2015. Delta Air Lines Inc. purchased a 3.55% share in China Eastern Airlines Corp for a total of $450 million. Thus, the newly opened negotiations can make the American Airlines the second U.S. airline to be the owner of a Chinese carrier’s stake.
Beijing Wants to Empower its Carriers through Stronger Global Airline Routes
This initiative comes on behalf of the Chinese company. The capital city, Beijing, is in full operations to expand its global airline routes. However, it needs the support of private capital to make things happen. The mixed-ownership strategy is, in fact, a power unity that can improve key aspects in the organization. China Southern Airlines needs better competitiveness and efficiency to become a first-tier company.
At the moment, China Southern has routes from Guangzhou to key cities in the United States, such as New York, Hawaii, Chicago, and Boston. It is also part of the SkyTeam alliance. The company is already collaborating with other two American carriers, namely Delta and Virgin American. Together they share a number of same flights.
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