China Eastern

The airline was established on June 25, 1988, on the basis of the CAAC Huadong Administration. In 1997, China Eastern took over loss-making China General Aviation and also became the country's first airline to offer shares on the international market. It founded China Cargo Airlines in a joint venture with COSCO in 1998. In March 2001, it completed the takeover of Air Great Wall.^[1] China Yunnan Airlines and China Northwest Airlines merged into China Eastern Airlines in 2003.

China Eastern Airlines is owned by the Chinese government (61.64%), publicly held H shares (32.19%) and publicly held A shares (6.17%), and has 29,746 employees (as of March 2007).^[1] It had 16,435 employees in January 2005. On April 20, 2006, the media broke news on the possible sale of up to 20% of its stake to foreign investors, including Singapore Airlines, Emirates Airline and Japan Airlines, with the former confirming that negotiations were underway.^[4]^[5]

After receiving an approval from the State Council of China, it was announced that on September 2, 2007, Singapore Airlines and Temasek Holdings (holding company which owns 55% of Singapore Airlines) would jointly acquire shares of China Eastern Airlines.^[6]^[7] On November 9, 2007, investors signed a final agreement to buy a combined 24% stake in China Eastern Airlines: Singapore Airlines will own 15.73% and Temasek Holdings - 8.27% stake in the airline.^[8]

Singapore Airlines pending entry into the Chinese market prompted the Hong Kong carrier Cathay Pacific to launch an attempt to block the deal by buying a significant stake in China Eastern and voting down the deal together with Air China (which already holds an 11% stake in China Eastern) at the shareholder's meeting in December 2007.^[9]^[10] However on September 24 Cathay Pacific announced that it had abandoned such plans.^[11]

Air China's parent company, the China National Aviation Corporation, a state-owned company, announced in January 2008 that it would offer 32% more than Singapore Airlines for the 24% stake in China Eastern, potentially complicating the deal that Singapore Airlines and Temasek had proposed. ^[12]However, minority shareholders declined the offer made by Singapore Airlines. It is thought that this is due to the massive effort made by Air China to buy the 24% stake. ^[13]

Either way, it could also mean that a Star Alliance member would be the main airline stakeholder for China Eastern, which is considering entering the Skyteam or Oneworld alliance.

Destinations

China Eastern Airlines has a strong presence on routes in Asia, Europe, North America and Australia. In 2004, airline terminated its unprofitable Shanghai-Brussels-Madrid route. However, this led to the creation of a new Shanghai-Melbourne route the same year. In 2007, China Eastern Airlines began servicing its first African destination, Johannesburg (via Male). Also in 2007, it began operations to New York from Shanghai, making it the longest non-stop route for the airline. On November 22, China Eastern Airlines started a seasonal service on Shanghai-Brisbane route, flying twice per week.

According to Bloomberg, China Eastern Airlines will add an extra 2 frequencies to its Shanghai-Los Angeles route, to start in June 2008. All of the other major airlines in China are adding 4-5 destinations.^[14] Other sources report that China Eastern will add extra frequencies to London, New York and Vancouver.

Reports say that China Eastern is on the plan to order 40 more A320s for fleet growth. It will not order the A380, as it is losing money on International routes, especially the new Shanghai-New York JFK route, where it may have been pulled out immediately after launch due to low yields.

It is the China Eastern Airlines plans to open a line between Algiers and Shanghai via Paris. Algiers-Paris-Shanghai will operational during the month of August 2008, using the Airbus A340-600. [1]

Fleet

The China Eastern Airlines fleet includes the following aircraft as of November 2007 (which consists a diverse fleet with limited compatibility in type ratings):

Cargo

A cargo subsidiary of China Eastern Airlines, China Cargo Airlines, operates the following aircraft as of November 2007:

Aircraft orders

Previously operated

Subsidiaries

China Cargo Airlines

China Eastern Airlines Jiangsu

This subsidiary airline is based in Nanjing, started operations in 1993 and operates services from Nanjing using aircraft from the parent company. Its main base is Nanjing Lukou International Airport. It is owned by China Eastern Airlines (63%) and Jiangsu Provincial Guoxin Asset Management Group (24%).^[1]

China Eastern Airlines Wuhan

This subsidiary airline (ICAO Code: CWU) is based in Wuhan, started operations in 1986 and operates domestic scheduled services from Wuhan and international services to Thailand. In September 1997, the airline jointly founded the Xinxing (New Star) Alliance with five other provincial airlines. In August 2002 the airline was acquired by China Eastern Airlines and renamed China Eastern Airlines Wuhan, operating under the China Eastern name and using the parent company's aircraft. Its main base is Wuhan Tianhe International Airport. It is owned by China Eastern Airlines (96%), state-owned Assets Supervision and Administration Commission (2%) and others (2%).^[1]

China Eastern Yunnan Airlines

This subsidiary airline (IATA Code: 3Q, ICAO Code: CYH), was established in July 1992 and operates scheduled domestic services on trunk and secondary routes, as well as tourist routes from Kunming to Southeast Asia, using aircraft from the parent company. It was established in 1992 from the CAAC Yunnan regional authority. In October 2002, China Eastern Airlines took control with approval from the Chinese Cabinet. It is wholly owned by China Eastern Air Holding and its main base is Kunming Wujiaba International Airport.^[1]

Incidents and accidents

Codeshare agreements

As of May 2007, China Eastern Airlines had codeshare agreements with the following airlines:

References

^ ^a ^b ^c ^d ^e ^f "Directory: World Airlines", Flight International (2007-04-03), p. 64.
^ China Eastern Airlines seeking to join oneworld alliance - report
^ China Eastern Airlines Official 3 Star Ranking for China Eastern Airlines product and China Eastern Airlines service quality
^ Shanghai Daily
^ Channel News Asia
^ SIA approved to buy into China Eastern Flight Global, 31/08/07
^ "SIA, China Eastern Airlines announce strategic tie-up", Channel NewsAsia (September 2, 2007). Retrieved on 2007-09-02.
^ "Singapore Airlines, Temasek sign China Eastern deal", Channel NewsAsia (November 9, 2007). Retrieved on 2007-11-09.
^ "Cathay Pacific to try and block Singapore Airlines: report", Agence France-Presse, Channel NewsAsia (September 22, 2007). Retrieved on 2007-09-22.
^ http://news.bbc.co.uk/chinese/trad/low/newsid_7000000/newsid_7009900/7009931.stm Chinese
^ Cathay Pacific abandons China Eastern plan
^ FT.com / Companies / Transport - Air China pursues China Eastern stake
^ Anderlini, Jamil (2008-01-08). "Shareholders reject Singapore Air offer". FT.com. Retrieved on 2008-01-08.
^ Bloomberg.com: Canada
^ China Eastern Airlines Fleet Age
^ ASN Aircraft accident McDonnell Douglas MD-11 B-2173 Shanghai-Hongqiao Airport (SHA)
^ Codeshare Alliances - China Eastern Airlines

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