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Oneworld confirms it has sounded out China Southern Airlines to join the alliance

12/17/2018| 4:16:12 PM| 中文

It is seen by observers as being at risk of leaving Oneworld due to the overlap with its nearby Chinese neighbour or it might at least exercise a veto on China Southern joining.

Rob Gurney, the CEO of Oneworld, said it had yet to start formal talks with the mainland’s biggest airline China Southern Airlines, after the group’s biannual board meeting in New York last week. The alliance indicated it had spoken to the carrier but not since it announced its exit from the rival Skyteam alliance.

But Gurney acknowledged that the alliance had been speaking to the mainland carrier.

“We haven’t spoken to them [China Southern Airlines] since it has happened. And you know we have got a fantastic partner in Cathay Pacific, a Chinese airline, and they remain really important to us,” he said.

Cathay Pacific would not be drawn on China Southern’s intentions when speaking behind closed doors to financial analysts late last month in the first comments it offered. It is seen by observers as being at risk of leaving Oneworld due to the overlap with its nearby Chinese neighbour or it might at least exercise a veto on China Southern joining.

Cathay addressed the possibility of the Guangzhou-based carrier as a new member as “pure rumours”.

Chief customer and commercial officer Paul Loo Kar-pui added that Cathay was “very happy” being part of Oneworld, dampening fears it might leave, noting it was working in its alliance with “quality carriers”.

China Southern could not be reached for comment.

Last year, American paid USD 200 million (HK$1.5 billion) for a 2.76% stake in China Southern, seen as an attempt to get the carrier to join Oneworld. The deal cast doubt on its existing membership when Skyteam alliance members Delta Air Lines joined forces with China Eastern and Air France-KLM to create a global pact without the Guangzhou carrier.

The Oneworld boss noted that a number of member airlines were lining up to work with China Southern on bilateral deals. American Airlines announced an expanded partnership with the mainland Chinese airline soon after the latter’s Skyteam exit was made public.

China Southern has 580 aircraft and carried 126 million passengers last year, making an operating profit of USD 1.1 billion last year. At the same time, Cathay Pacific has around 200 planes and carried 34 million people, but registered a loss of HK$1.25 billion (USD 160 million).

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TAGS: Oneworld | China Southern
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