Germany’s Lufthansa, Air China Mull Joint Venture on Routes
By Esther Tanquintic-Misa | July 7, 2014 3:18 PM EST
German airline Lufthansa will be entering into a joint venture with Air China that will see the two airlines share revenue on certain routes in Asia by selling each other's flight tickets. The routes are situated between China and Europe.
Air China's inaugural flight from Beijing to Washington arrives at Dulles International Airport in Virginia June 10, 2014. REUTERS/Gary Cameron (UNITED STATES - Tags: TRANSPORT BUSINESS)
The carriers are both members of the Star Alliance, the world's biggest. The other aviation alliances are SkyTeam alliance and Oneworld alliance.
"We aim to deepen and further expand our relationship in the face of rising competition from other airline alliances," the WSJ quoted an unidentified official at Air China.
The routes on which the two airlines will share were not revealed as of yet.
This won't be the first time an agreement of sorts will be made between Lufthansa and Air China. In 1989, the two airline firms created Ameco Beijing which was an aircraft-maintenance joint venture, according to the WSJ. Majority or 60 per cent of the partnership was controlled by Air China, while Lufthansa owned the rest. The first ever code-sharing agreement between the German and Chinese was signed in 2000.
Reuters reported Lufthansa had been talking with Air China for months now. It wants to strengthen its position in Asia, where Dubai-based Emirates and Turkish Airlines have been expanding.
"European carriers are seeking stronger ties into growth markets like China to offset shrinking European business," investment research portal Seeking Alpha said. "Joint ventures allow airlines to closely coordinate operations and ticket pricing. On certain routes, the airlines can even operate like a single carrier without violating antitrust rules."
Lufthansa has existing revenue-sharing joint ventures with Air Canada, Japan's ANA Holdings and U.S.-based United Continental Holdings.
To report problems or to leave feedback about this article, e-mail:
To contact the editor, e-mail:
Join the Conversation
- Travel Alert: Australia Mulls To Review Airport Security Policy, Could Allow Scissors, Metal Cutlery Back In Planes
- 5 Likely Reasons Why You Are Not Getting Hired
- This Is How Obesity Weighs Down Global Economy By 2 Trillion Dollars Every Year
- Consumer Alert: Retailer Simons Goes Out Of Quebec, To Open Five Stores Across Canada
- Signs That You Are A Smartphone Zombie (And The Dangers This Poses)
- Russia Is Ready for Shooting War, Will Likely Win Looming Nuclear Showdown with U.S. – Report
- Kobani ISIS Fighter Sends Out Desperate Message For Prayers And Support: Euphoria Turns Into Desperation As Kurds Advance
- Home Depot Early Black Friday 2014 Sale Up To Nov. 29, 2014 Includes Special Buys On Appliances Such As Samsung Refrigerators, Whirlpool Electric Ranges And Hoover Vacuum Cleaners
- Microsoft Band Runs Out Of Stock, But Offers $10 Gift Voucher To Wait-Listed Customers
- ISIS War: US Airstrikes Lead to Growing ISIS Support In Syria; Russia Questions Coalition's Policies
- Google Joins Forces with GoPro Inc with New Google Maps Focusing on Destination
- Target Early Black Friday 2014 Sale Ad Released For Nov. 26, 2014 Includes Deals On Toys, HDTVs And Video Games Such As ‘FIFA 15’ And ‘NHL 15’ For Xbox 360 [WATCH VIDEO]