China Eastern Airlines and China Southern Airlines have signed a cooperative business agreement. China Eastern Airlines say that they will cooperate with China Southern Airlines in ten areas including sharing routes and frequent-flyer mileage, marketing and sales, and purchasing aircraft.
Their cooperation involves almost all aspects of their business except for the investors' stakes.
Liu Shaoyong, chairman of board of China Southern Airlines, said in his speech at the signing ceremony that China Eastern Airlines owned great flight networks throughout the eastern areas of China, Beijing, and Shanghai; while China Southern Airlines focuses on southern China, which lets the two companies greatly extend their domestic routes through this cooperation. He said that China Southern will cooperate with China Eastern in areas that include sales and marketing, aircraft purchasing, aviation materials, ground service, and personnel training; and that the two airlines can effectively reduce their operational costs and benefit from economies of scale.
China Southern Airlines said that this cooperative business agreement with China Eastern is not an exclusive agreement and that, in the future, they will be able to cooperate with other airlines such as Air China and Shanghai Airlines.