Continuing a trend of Chinese airlines teaming up with municipal and city councils to promote economic development, China Eastern Airlines (MU, Shanghai Hongqiao) has signed a strategic cooperation framework with the Shanghai Municipal People's Government to "deepen cooperation" and promote development in the city.
At a January 29 meeting in Shanghai attended by Li Yangmin, general manager of China Eastern Airlines; Chen Jining, secretary of the Municipal Party Committee; and Gong Zheng, deputy secretary of the Municipal Party Committee and also the city mayor, the parties agreed to work together to build Shanghai into a "world-class aviation hub."
While some private interests, such as Air France-KLM and Travelsky Technology, have holdings in China Eastern Airlines, the carrier is majority government-owned, with the China State-Owned Assets Supervision and Administration Commission having a 55.9% shareholding. According to ch-aviation PRO airlines data, the airline has 633 aircraft in its fleet (597 active) and is by far the biggest operator at its Shanghai Hongqiao International Airport base, with more than double the available weekly seat capacity and flights of its wholly-owned subsidiary and nearest market share rival, Shanghai Airlines (FM, Shanghai Hongqiao).
Hongqiao Airport is owned by Shanghai Airport Authority, which is a state-owned enterprise of the Shanghai Municipal Government, one of the two parties to this agreement. They also own Shanghai's other international airport, Shanghai Pudong, where China Eastern Airlines has an equally commanding market share. Combining China Eastern and Shanghai Airlines, the China Eastern Group has more than 50% of the weekly seats and flights in and out of Hongqiao and over 40% at Pudong. The new agreement encourages China Eastern to increase its network and "service format" out of its Shanghai airports.
"As a state-owned backbone air transport group headquartered in Shanghai, it (China Eastern) will continue to deepen cooperation with Shanghai in various fields, (and) strive to build a global competitive air transport supercarrier, " said the text of the agreement. "The transportation system provides strong support for Shanghai to build a socialist modern international metropolis with world influence."
ch-aviation has recently reported on several similar agreements between airlines and local governments in China, including Juneyao Air (HO, Shanghai Hongqiao) agreeing to develop fleet and base operations at Chengdu Tianfu, and Tianjin Airlines (GS, Tianjin) agreeing to open a new base at Lianyungang.
